[Federal Register Volume 84, Number 20 (Wednesday, January 30, 2019)]
[Notices]
[Pages 469-473]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-00303]


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DEPARTMENT OF ENERGY

[Case Number 2018-001]


Energy Conservation Program: Notice of Decision and Order Denying 
an Exemption to Aero-Tech Light Bulb Co. From the Department of Energy 
Rough Service Lamps Energy Conservation Standards

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

ACTION: Notice of decision and order.

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SUMMARY: The U.S. Department of Energy (DOE) gives notice of a Decision 
and Order (Case Number 2018-001) that denies Aero-Tech Light Bulb Co.'s 
(Aero-Tech) application for a two-year small business exemption from 
compliance with the DOE rough service lamp energy conservation 
standards.

DATES: The Decision and Order is effective on January 17, 2019.

ADDRESSES: The docket, which includes Federal Register notices, 
comments, and other supporting documents/materials, is available for 
review at https://www.regulations.gov. All documents in the docket are 
listed in the https://www.regulations.gov index. However, some 
documents listed in the index, such as those containing information 
that is exempt from public disclosure, may not be publicly available.
    The docket web page can be found at http://www.regulations.gov/docket?D=EERE-2018-BT-PET-0016. The docket web page contains simple 
instruction on how to access all documents, including public comments, 
in the docket.

FOR FURTHER INFORMATION CONTACT: 
    Dr. Stephanie Johnson, U.S. Department of Energy, Building 
Technologies Program, Mailstop EE-2J, 1000 Independence Avenue SW, 
Washington, DC 20585-0121. Telephone: (202) 287-1943. E-mail: 
[email protected].
    Ms. Celia Sher, U.S. Department of Energy, Office of the General 
Counsel, Mail Stop GC-33, Forrestal Building, 1000 Independence Avenue 
SW, Washington, DC 20585-0103. Telephone: (202) 287-6122. E-mail: 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    On December 26, 2017, DOE issued a final rule codifying at 10 CFR 
430.32(bb) statutory backstop requirements applicable to rough service 
lamps and vibration service lamps. Prior to the rule, these backstop 
requirements were triggered as a result of rough and vibration service 
lamps exceeding a previously announced sales threshold and in the 
absence of any other energy conservation regulation issued by DOE for 
these lamps. In particular, the final rule applies a statutorily 
established 40-watt maximum energy use and packaging limitation to 
rough and vibration service lamps manufactured on or after January 25, 
2018. 82 FR 60845.
    On May 23, 2018, Aero-Tech submitted an application, pursuant to 
Subpart E of 10 CFR part 430, requesting a two-year small business 
exemption from the DOE rough service lamps energy conservation 
standards found in 10 CFR 430.32(bb). Aero-Tech requested an exemption 
from the standards on the basis of its status as a small business. 
According to Aero-Tech, failure to receive a small business exemption 
would likely result in a lessening of competition in the market for 
lighting companies.
    Under 42 U.S.C. 6295(t), DOE may grant to a manufacturer a 
temporary exemption from an applicable energy conservation standard if 
DOE finds that the annual gross revenues of such manufacturer from all 
its operations (including the manufacture and sale of covered products) 
does not exceed $8,000,000 for the 12-month period preceding the date 
of the application. In making this finding, DOE must account for the 
annual gross revenues of any other person who controls, is controlled 
by, or is under common control with, such manufacturer. (42 U.S.C. 
6295(t)(1)) The Secretary of Energy (Secretary) may not grant an 
exemption with respect to any type (or class) of covered product 
subject to an energy conservation standard unless the Secretary finds, 
after obtaining the written views of the Attorney General, that a 
failure to allow an exemption would likely result in a lessening of 
competition. (42 U.S.C. 6295(t)(2)) See also, subpart E of 10 CFR part 
430. A notice of the decision of the Secretary must be published in the 
Federal Register along with the reason for denying or granting the 
application. 10 CFR 430.56(c)
    On October 15, 2018, DOE issued a notice announcing the receipt of 
and publishing Aero-Tech's application for exemption. 83 FR 51931. In 
accordance with its regulations, DOE also transmitted Aero-Tech's 
application for exemption to the Attorney General by the Secretary 
along with: (a) A statement of the facts and of the reasons for the 
exemption, and (b) copies of all documents submitted. 10 CFR 430.54. 
DOE received one comment submitted by the National Electrical 
Manufacturers Association (NEMA) which provided data and supporting 
factual information

[[Page 470]]

relating to rough service lamp sales. NEMA did not take a position on 
the merits of Aero-Tech's application.\1\
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    \1\ NEMA's comment can be accessed at: https://www.regulations.gov/document?D=EERE-2018-BT-PET-0016-0002.
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II. Final Denial

    In accordance with Title 10 of the Code of Federal Regulations (10 
CFR 430.56(c)), DOE gives notice of the issuance of its decision and 
order denying Aero-Tech's application for a small business exemption. 
The final decision document setting forth the relevant facts and the 
legal basis for denying Aero-Tech's application is available in the 
docket referenced above (http://www.regulations.gov/docket?D=EERE-2018-BT-PET-0016). In evaluating this matter, DOE's primary consideration 
was whether a failure to allow the exemption would result in a 
lessening of competition. After consultation with the Attorney General, 
DOE does not believe Aero-Tech has demonstrated that this would be the 
case. In its assessment letter responding to
    DOE, the Department of Justice (DOJ) concluded that failure to 
grant Aero-Tech's application for a small business exemption for rough 
service lamps would likely not result in a lessening of competition. 
DOJ made this determination after reviewing Aero-Tech's application, as 
well as speaking with industry representatives and reviewing the 
supplementary information submitted to DOE by industry representatives. 
As part of its analysis, DOJ noted that it applies the standard set 
forth in 42 U.S.C. 6295(t)(2), and examines whether failure to grant a 
small business exemption would likely result in a lessening of 
competition, for example, by substantially limiting consumer choice or 
increasing industry concentration. DOE is publishing the Attorney 
General's determination letter at the end of this notice. In light of 
the Attorney General's written finding, DOE has no independent basis to 
come to a different conclusion than the DOJ with regard to Aero-Tech's 
request for a small business exemption, and, therefore, DOE cannot make 
a finding that a failure to allow an exemption to Aero-Tech would 
result in a lessening of competition.

    Signed in Washington, DC, on January 17, 2019.
Daniel R Simmons,
Assistant Secretary, Energy Efficiency and Renewable Energy.

[[Page 471]]

[GRAPHIC] [TIFF OMITTED] TN30JA19.000


[[Page 472]]


[GRAPHIC] [TIFF OMITTED] TN30JA19.001

Case #2018-001

Decision and Order

I. Background and Authority

    The Energy Policy and Conservation Act of 1975 (EPCA),\1\ Public 
Law 94-163 (42 U.S.C. 6291-6317, as codified), among other things, 
authorizes the U.S. Department of Energy (DOE) to establish energy 
conservation standards for certain consumer products and industrial 
equipment. Title III, Part B \2\ of EPCA established the Energy 
Conservation Program for Consumer Products Other Than Automobiles, 
which sets forth a variety of provisions designed to improve energy 
efficiency for certain types of consumer products. These products 
include rough service lamps, the focus of this document. (42 U.S.C. 
6295(l)(4)(A))
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    \1\ All references to EPCA in this document refer to the statute 
as amended through the EPS Improvement Act of 2017, Public Law 115-
115 (January 12, 2018).
    \2\ For editorial reasons, upon codification in the U.S. Code, 
Part B was redesignated as Part A.
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    On December 26, 2017, DOE issued a final rule codifying at 10 CFR 
430.32(bb) statutory backstop requirements applicable to rough service 
lamps and vibration service lamps. Prior to the rule, these backstop 
requirements were triggered as a result of rough and vibration service 
lamps exceeding a previously announced sales threshold and in the 
absence of any other energy conservation regulation issued by DOE for 
these lamps. In particular, the final rule placed in the Code of 
Federal Regulations a statutorily established 40-watt maximum energy 
use and packaging limitation for rough and vibration service lamps 
manufactured on or after January 25, 2018. DOE subsequently published 
an Enforcement Policy Statement announcing a May 1, 2018 compliance 
date for the rule.\3\ For rough service lamps, the statute requires the 
lamps to: (1) Have a shatter-proof coating or equivalent technology 
that complies with NSF/ANSI 51 and is designed to contain the glass if 
the glass envelope of the lamp is broken and to provide effective 
containment over the life of the lamp; (2) have a maximum 40-watt 
limitation; and (3) be sold at retail only in a package containing one 
lamp. (42 U.S.C. 6295(l)(4)(D)(ii))
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    \3\ DOE's Enforcement Policy Statement can be accessed here: 
https://www.energy.gov/sites/prod/files/2018/02/f48/Enforcement%20Policy%20-%202018%20VSL%20RSL.pdf.
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    Under 42 U.S.C. 6295(t), DOE may grant to a manufacturer a 
temporary exemption from an applicable energy conservation standard if 
DOE finds that the annual gross revenues of such manufacturer from all 
its operations (including the manufacture and sale of covered products) 
does not exceed $8,000,000 for the 12-month period preceding the date 
of the application. In making this finding, DOE must account for the 
annual gross revenues of any other person who controls, is controlled 
by, or is under common control with, such manufacturer (referred to 
herein as a ``small business exemption''). (42 U.S.C. 6295(t)(1)) The 
Secretary of Energy (Secretary) may not grant a small business 
exemption with respect to any type (or class) of covered product 
subject to an energy conservation standard unless the Secretary finds, 
after obtaining the written views of the Attorney General, that a 
failure to allow an exemption would likely result in a lessening of 
competition. (42 U.S.C. 6295(t)(2)) See also, subpart E of 10 CFR part 
430. A notice of the decision of the Secretary must be published in the 
Federal Register along with the reason for denying or granting the 
application. 10 CFR 430.56(c)

II. Application for Exemption

    On May 23, 2018, Aero-Tech Light Bulb Co. (Aero-Tech) submitted an 
application for a small business exemption pursuant to 42 U.S.C. 
6295(t) and Subpart E of 10 CFR part 430, requesting an exemption from 
the DOE rough service lamps energy conservation standards found in 10 
CFR 430.32(bb). Specifically, Aero-Tech requested an exemption from 
compliance with the standards until January 25, 2020. The application 
indicated that Aero-Tech is an importer and distributor of rough 
service light bulbs. In its application, Aero-Tech asked for an 
exemption from the standards on the basis of its status as a small 
business. According to Aero-Tech, failure to receive a small business 
exemption would likely result in a lessening of competition in the 
market for lighting companies. In its application, Aero-Tech stated 
that, failure to grant an exemption would mean that Aero-Tech would 
lose 70% of its business and have to close its doors.
    On October 15, 2018, DOE published a notice announcing its receipt 
of the application for exemption and solicited comments from interested 
parties. 83 FR 51931. In accordance with its regulations, DOE also 
transmitted Aero-Tech's application for exemption to the Attorney 
General along with: (a) A statement of the facts and of the reasons for 
the exemption, and (b) copies of all documents submitted. 10 CFR 
430.54. DOE received one comment submitted

[[Page 473]]

by the National Electrical Manufacturers Association (NEMA) which 
provided data and supporting factual information relating to rough 
service lamp sales.\4\ In its comments, NEMA provided the names of nine 
NEMA manufacturers and two non-member companies that sell rough service 
lamps. While NEMA did not take a position on the merits of Aero-Tech's 
application, NEMA's comments indicated that the demand for rough 
service lamps is decreasing as customers are migrating to light-
emitting diode (LED) light bulbs for rough service applications at 
higher light output levels.
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    \4\ NEMA's comment can be accessed at: https://www.regulations.gov/document?D=EERE-2018-BT-PET-0016-0002.
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III. Consultation with Other Agencies

    Per 42 U.S.C. 6295(t)(2), DOE obtained the written views of the 
Attorney General concerning Aero-Tech's application for exemption. 
Under this statutory provision, DOE may only grant a small business 
exemption if it has consulted with the Attorney General and finds that 
a lessening of competition would likely result. In its assessment 
letter responding to DOE, the Department of Justice (DOJ) concluded 
that failure to grant Aero-Tech's application for a small business 
exemption for rough service lamps would likely not result in a 
lessening of competition. DOJ made this determination after reviewing 
Aero-Tech's application, as well as speaking with industry 
representatives and reviewing the supplementary information submitted 
to DOE by industry representatives. As part of its analysis, DOJ noted 
that it applies the standard set forth in 42 U.S.C. 6295(t)(2), and 
examines whether failure to grant a small business exemption would 
likely result in a lessening of competition, for example, by 
substantially limiting consumer choice or increasing industry 
concentration.

IV. Order

    DOE has no independent basis to come to a different conclusion than 
the DOJ with regard to Aero-Tech's request for a small business 
exemption. Thus, DOE does not find that Aero-Tech has demonstrated that 
a failure to allow the exemption would result in a lessening of 
competition, as required under 42 U.S.C. 6295(t)(2). It is Ordered that 
the application for a small business exemption submitted on May 23, 
2018 by Aero-Tech Light Bulb Co. is denied.

    Signed in Washington, DC, on January 17, 2019.
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Daniel R. Simmons,

Assistant Secretary, Energy Efficiency and Renewable Energy.


[FR Doc. 2019-00303 Filed 1-29-19; 8:45 am]
 BILLING CODE 6450-01-P