[Federal Register Volume 84, Number 248 (Friday, December 27, 2019)]
[Rules and Regulations]
[Pages 71626-71671]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-27515]



[[Page 71625]]

Vol. 84

Friday,

No. 248

December 27, 2019

Part IV





Department of Energy





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10 CFR Part 430





Energy Conservation Program: Energy Conservation Standards for General 
Service Incandescent Lamps; Final Rule

  Federal Register / Vol. 84 , No. 248 / Friday, December 27, 2019 / 
Rules and Regulations  

[[Page 71626]]


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DEPARTMENT OF ENERGY

10 CFR Part 430

[EERE-2019-BT-STD-0022]
RIN 1904-AE76


Energy Conservation Program: Energy Conservation Standards for 
General Service Incandescent Lamps

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

ACTION: Final determination.

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SUMMARY: The Energy Policy and Conservation Act, as amended (``EPCA''), 
directs DOE to initiate a rulemaking for general service lamps 
(``GSLs'') that, among other requirements, determines whether standards 
in effect for general service incandescent lamps (``GSILs,'' a subset 
of GSLs) should be amended. On September 5, 2019, the U.S. Department 
of Energy (``DOE'') published a notice of proposed determination 
(``NOPD'') in which DOE initially determined that energy conservation 
standards for GSILs do not need to be amended. In this final 
determination, DOE responds to comments received on the September 2019 
GSIL NOPD and does not adopt amended energy conservation standards for 
GSILs. DOE has determined that amended energy conservation standards 
for GSILs would not be economically justified.

DATES: The effective date of this rule is December 27, 2019.

ADDRESSES: The docket for this rulemaking, which includes Federal 
Register notices, public meeting attendee lists and transcripts, 
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, not all 
documents listed in the index may be publicly available, such as 
information that is exempt from public disclosure.
    The docket web page can be found at https://www.regulations.gov/docket?D=EERE-2019-BT-STD-0022. The docket web page contains 
instructions on how to access all documents, including public comments, 
in the docket.
    For further information on how to review the docket, contact the 
Appliance and Equipment Standards Program staff at (202) 287-1445 or by 
email: [email protected].

FOR FURTHER INFORMATION CONTACT: 
    Ms. Lucy deButts, U.S. Department of Energy, Office of Energy 
Efficiency and Renewable Energy, Building Technologies Office, EE-5B, 
1000 Independence Avenue SW., Washington, DC 20585-0121. Email: 
[email protected].
    Ms. Celia Sher, U.S. Department of Energy, Office of the General 
Counsel, GC-33, 1000 Independence Avenue SW, Washington, DC 20585-0121. 
Telephone: (202) 287-6122. Email: [email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Synopsis of the Final Determination
II. Introduction
    A. Authority
    B. Background
    1. Current Standards
    2. History of Standards Rulemaking for GSILs
III. General Discussion
    A. Product Classes and Scope of Coverage
    B. Test Procedure
    C. Technological Feasibility
    1. General
    2. Maximum Technologically Feasible Levels
    D. Energy Savings
    1. Determination of Savings
    2. Significance of Savings
    E. Economic Justification
    1. Specific Criteria
    a. Economic Impact on Manufacturers and Consumers
    b. Savings in Operating Costs Compared To Increase in Price (LCC 
and PBP)
    c. Energy Savings
    d. Lessening of Utility or Performance of Products
    e. Impact of Any Lessening of Competition
    g. Other Factors
    2. Rebuttable Presumption
IV. DOE's Proposal and Discussion of Related Comments
V. Legal Issues and Discussion of Related Comments
    A. Imposition of the Backstop
    B. EPCA's Anti-Backsliding Provision and Congressional Intent
    C. Product Substitutes
    D. Economic Justification
    E. Preemption
    F. Scope
    G. NEPA
    H. Other Environmental Laws and Intergovernmental Consultation
VI. Methodology and Discussion of Related Comments
    A. Market and Technology Assessment
    1. Scope of Coverage
    2. Metric
    3. Technology Options
    4. Screening Analysis
    5. Product Classes
    B. Engineering Analysis
    1. Representative Product Classes
    2. Baseline Lamps
    3. More Efficacious Substitutes
    4. Efficacy Levels
    5. Scaling to Other Product Classes
    6. Product Substitutes
    C. Product Price Determination
    D. Energy Use Analysis
    1. Operating Hours
    a. Residential Sector
    b. Commercial Sector
    2. Input Power
    3. Lighting Controls
    E. Life-Cycle Cost and Payback Period Analysis
    1. Product Cost
    2. Installation Cost
    3. Annual Energy Consumption
    4. Energy Prices
    5. Energy Price Trends
    6. Product Lifetime
    7. Discount Rates
    8. Efficacy Distribution
    9. LCC Savings Calculation
    10. Payback Period Analysis
    F. Shipments Analysis
    1. Shipments Model
    a. Lamp Demand Module
    b. Price-Learning Module
    c. Market-Share Module
    G. National Impact Analysis
    1. National Energy Savings
    2. Net Present Value Analysis
    H. Manufacturer Impact Analysis
    1. Manufacturer Production Costs
    2. Shipments Projections
    3. Product and Capital Conversion Costs
    4. Markup Scenarios
VII. Analytical Results and Conclusions
    A. Trial Standard Levels
    B. Economic Impacts on Individual Consumers
    1. Life-Cycle Cost and Payback Period
    2. Rebuttable Presumption Payback
    C. National Impact Analysis
    1. Energy Savings
    2. Net Present Value of Consumer Costs and Benefits
    D. Economic Impacts on Manufacturers
    1. Industry Cash Flow Analysis Results
    2. Direct Impacts on Employment
    3. Impacts on Manufacturing Capacity
    4. Impacts on Subgroups of Manufacturers
    5. Cumulative Regulatory Burden
    E. Conclusion
    1. Technological Feasibility
    2. Significant Conservation of Energy
    3. Economic Justification
VIII. Procedural Issues and Regulatory Review
    A. Review Under Executive Orders 12866 and Administrative 
Procedure Act
    B. Review Under Executive Orders 13771 and 13777
    C. Review Under the Regulatory Flexibility Act
    D. Review Under the National Environmental Policy Act of 1969
    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, 1999
    I. Review Under Executive Order 12630
    J. Review Under the Treasury and General Government 
Appropriations Act, 2001
    K. Review Under Executive Order 13211
    L. Information Quality
    M. Congressional Notification
IX. Approval of the Office of the Secretary

[[Page 71627]]

I. Synopsis of the Final Determination

    Title III, Part B \1\ of the Energy Policy and Conservation Act, as 
amended (``EPCA''),\2\ established the Energy Conservation Program for 
Consumer Products Other Than Automobiles. (42 U.S.C. 6291-6309) These 
products include GSILs, the subject of this rulemaking.
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    \1\ For editorial reasons, upon codification in the U.S. Code, 
Part B was redesignated Part A.
    \2\ All references to EPCA in this document refer to the statute 
as amended through America's Water Infrastructure Act of 2018, 
Public Law 115-270 (October 23, 2018).
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    DOE is issuing this final determination pursuant to the EPCA 
requirement that DOE must initiate a rulemaking for GSLs and, among 
other requirements, determine whether standards in effect for GSILs 
should be amended. (42 U.S.C. 6295(i)(6)(A)) DOE has concluded that 
energy conservation standards for GSILs do not need to be amended 
because more stringent standards are not economically justified. For 
ease of reference, the following provides a list of acronyms used in 
this final determination.

------------------------------------------------------------------------
            Term(s)              Reference in this  final determination
------------------------------------------------------------------------
Administrative Procedure Act..  APA
Annual Energy Outlook.........  AEO
Capital Asset Pricing Model...  CAPM
Code of Federal Regulations...  CFR
Color Rendering Index.........  CRI
Commercial Building Stock       CBSA
 Assessment.
Commercial Buildings Energy     CBECS
 Consumption Survey.
Compact Fluorescent Lamp......  CFL
Compliance Certification        CCMS
 Management System.
Correlated Color Temperature..  CCT
Direct Heating Equipment......  DHE
Efficiency Level..............  EL
Energy Independence and         EISA
 Security Act of 2007.
Energy Information Association  EIA
Energy Policy Conservation Act  EPCA
Environmental Assessment......  EA
Environmental Impact Statement  EIS
Executive Order...............  EO
Final Information Quality       Bulletin
 Bulletin for Peer Review.
Final Regulatory Flexibility    FRFA
 Analysis.
Full-Fuel-Cycle...............  FFC
General Service Incandescent    GSIL
 Lamp.
General Service Lamp..........  GSL
Government Regulatory Impact    GRIM
 Model.
Halogen Infrared..............  HIR
Hours of Use..................  HOU
Incandescent Reflector Lamp...  IRL
Industry Net Present Value....  INPV
Infrared......................  IR
Initial Regulatory Flexibility  IRFA
 Analysis.
Life-Cycle Cost...............  LCC
Light-Emitting Diode..........  LED
Lighting Market                 LMC
 Characterization.
Manufacturer Impact Analysis..  MIA
Manufacturer Production Cost..  MPC
Manufacturer Selling Price....  MSP
Massachusetts Institute of      MIT
 Technology.
Medium Screw Base.............  MSB
National Energy Modeling        NEMS
 System.
National Energy Savings.......  NES
National Environmental Policy   NEPA
 Act of 1969.
National Impact Analysis......  NIA
Net Present Value.............  NPV
Notice of Data Availability...  NODA
Notice of Proposed Definition   NOPDDA
 and Data Availability.
Notice of Proposed              NOPD
 Determination.
Notice of Proposed Rulemaking.  NOPR
Office of Management and        OMB
 Budget.
Office of Science and           OSTP
 Technology Policy.
Organic Light-Emitting Diode..  OLED
Out-of-Scope Substitute Lamps.  LCC with Substitution
Parabolic Reflector...........  PAR
Payback Period................  PBP
Regulatory Reform Officer.....  RRO
Request for Information.......  RFI
Research and Development......  R&D
Residential Building Stock      RBSAM
 Assessment Metering Study.
Residential Energy Consumption  RECS
 Survey.
Secretary of Energy...........  Secretary
Selling, General, and           SG&A
 Administrative.

[[Page 71628]]

 
Small Business Administration.  SBA
Survey of Consumer Finances...  SCF
Technical Support Document....  TSD
Trial Standard Level..........  TSL
U.S. Department of Energy.....  DOE
U.S. Securities and Exchange    SEC
 Commission.
Unfunded Mandates Reform Act    UMRA
 of 1995.
Volts.........................  V
------------------------------------------------------------------------

II. Introduction

    The following section briefly discusses the statutory authority 
underlying this final determination, as well as some of the relevant 
historical background related to the establishment of standards for 
GSILs.

A. Authority

    Title III, Part B of EPCA established the Energy Conservation 
Program for Consumer Products Other Than Automobiles, which includes 
GSILs (a subset of GSLs) as covered products. (42 U.S.C. 6292(a)(14)) 
Amendments to EPCA in the Energy Independence and Security Act of 2007 
(``EISA'') directed DOE to conduct two rulemaking cycles to evaluate 
energy conservation standards for GSLs. (42 U.S.C. 6295(i)(6)(A)-(B)) 
GSLs are currently defined in EPCA to include GSILs, compact 
fluorescent lamps (CFLs), general service light-emitting diode (LED) 
lamps and organic light-emitting diode (OLED) lamps, and any other 
lamps that the Secretary of Energy (``Secretary'') determines are used 
to satisfy lighting applications traditionally served by GSILs. (42 
U.S.C. 6291(30)(BB))
    For the first rulemaking cycle, Congress instructed DOE to initiate 
a rulemaking process prior to January 1, 2014, to consider two 
questions: (1) Whether to amend energy conservation standards for 
general service lamps and (2) whether ``the exemptions for certain 
incandescent lamps should be maintained or discontinued.'' (42 U.S.C. 
6295(i)(6)(A)(i)) Further, if the Secretary determines that the 
standards in effect for GSILs should be amended, EPCA provides that a 
final rule must be published by January 1, 2017, with a compliance date 
at least 3 years after the date on which the final rule is published. 
(42 U.S.C. 6295(i)(6)(A)(iii)) If DOE fails to complete a rulemaking in 
accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv) or if a final rule from 
the first rulemaking cycle does not produce savings greater than or 
equal to the savings from a minimum efficacy standard of 45 lumens per 
watt, the statute provides a ``backstop'' under which DOE must prohibit 
sales of GSLs that do not meet a minimum 45 lumens per watt standard 
beginning on January 1, 2020. (42 U.S.C. 6295(i)(6)(A)(v))
    The EISA-prescribed amendments further directed DOE to initiate a 
second rulemaking cycle by January 1, 2020, to determine whether 
standards in effect for GSILs should be amended with more-stringent 
requirements and if the exemptions for certain incandescent lamps 
should be maintained or discontinued. (42 U.S.C. 6295(i)(6)(B)(i)) For 
the second review of energy conservation standards, the scope is not 
limited to incandescent lamp technologies. (42 U.S.C. 
6295(i)(6)(B)(ii))
    The energy conservation program for covered products under EPCA 
consists essentially of four parts: (1) Testing, (2) labeling, (3) the 
establishment of Federal energy conservation standards, and (4) 
certification and enforcement procedures. The Federal Trade Commission 
(FTC) is primarily responsible for labeling, and DOE implements the 
remainder of the program.
    Subject to certain criteria and conditions, DOE is required to 
develop test procedures to measure the energy efficiency, energy use, 
or estimated annual operating cost of each covered product. (42 U.S.C. 
6295(o)(3)(A) and (r)) Manufacturers of covered products must use the 
prescribed DOE test procedure as the basis for certifying to DOE that 
their products comply with the applicable energy conservation standards 
adopted under EPCA and when making representations to the public 
regarding the energy use or efficiency of those products. (42 U.S.C. 
6293(c) and 42 U.S.C. 6295(s)) Similarly, DOE must use these test 
procedures to determine whether the products comply with standards 
adopted pursuant to EPCA. (42 U.S.C. 6295(s)) The DOE test procedure 
for GSILs appears at Title 10 of the Code of Federal Regulations (CFR) 
part 430, subpart B, appendix R.
    Federal energy conservation requirements generally supersede State 
laws or regulations concerning energy conservation testing, labeling, 
and standards. (42 U.S.C. 6297(a)-(c)) Absent limited exceptions, 
states generally are precluded from adopting energy conservation 
standards for covered products both before and after an energy 
conservation standard becomes effective. (42 U.S.C. 6297(b) and (c)) 
However, the statute contains three narrow exceptions to this general 
preemption provision specific to GSLs in 42 U.S.C. 6295(i)(6)(A)(vi). 
Under the limited exceptions from preemption specific to GSLs that 
Congress included in EPCA, only California and Nevada have authority to 
adopt, with an effective date beginning January 1, 2018 or after, 
either: (1) A final rule adopted by the Secretary in accordance with 42 
U.S.C. 6295(i)(6)(A)(i)-(iv); (2) if a final rule has not been adopted 
in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv), the backstop 
requirement under 42 U.S.C. 6295(i)(6)(A)(v); or (3) in the case of 
California only, if a final rule has not been adopted in accordance 
with 42 U.S.C. 6295(i)(6)(A)(i)-(iv), any California regulations 
related to ``these covered products'' adopted pursuant to state statute 
in effect as of the date of enactment of EISA. (42 U.S.C. 
6295(i)(6)(A)(vi)) Because none of these narrow exceptions from 
preemption are available to California and Nevada, all states, 
including California and Nevada, are prohibited from adopting energy 
conservation standards for GSLs.\3\
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    \3\ DOE has provided a more detailed explanation as to why the 
preemption exceptions are not available to California and Nevada in 
its General Service Lamps definition final rule published on 
September 5, 2019. 84 FR 46661, as well as in section V.E. of this 
document.
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    Pursuant to the amendments contained in EISA, any final rule for 
new or amended energy conservation standards promulgated after July 1, 
2010, is required to address standby mode and off mode energy use. (42 
U.S.C. 6295(gg)(3)) Specifically, when DOE adopts a standard for a 
covered product after that date, it must, if justified by the criteria 
for adoption of standards under EPCA (42 U.S.C. 6295(o)), incorporate 
standby mode and off mode energy use into a single standard, or, if 
that is not feasible, adopt

[[Page 71629]]

a separate standard for such energy use for that product. (42 U.S.C. 
6295(gg)(3)(A)-(B)) DOE's current test procedure for GSILs does not 
address standby mode and off mode energy use because DOE concluded in a 
2009 final rule that these modes of energy consumption were not 
applicable to the lamps. 74 FR 31829, 31833 (July 6, 2009). In this 
analysis, DOE considers only active mode energy use in its 
determination of whether energy conservation standards for GSILs need 
to be amended.
    DOE is prohibited from prescribing an amended standard that DOE 
determines will not result in significant conservation of energy, is 
not technologically feasible, or is not economically justified. (42 
U.S.C. 6295(o)(3)) An evaluation of economic justification requires 
that DOE determine whether the benefits of a standard exceed its 
burdens through consideration, to the greatest extent practicable, of 
the following seven statutory 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 the covered product 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 standard;
    (3) The total projected amount of energy (or as applicable, water) 
savings likely to result directly from the standard;
    (4) Any lessening of the utility or the performance of the covered 
products likely to result from 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 
standard;
    (6) The need for national energy and water conservation; and
    (7) Other factors the Secretary of Energy considers relevant.

(42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII))
    DOE is publishing this final determination in satisfaction of 
EPCA's requirement to determine whether the standards in effect for 
GSILs should be amended. (42 U.S.C. 6295(i)(6)(A)(i) and (iii))

B. Background

1. Current Standards
    In a final rule published on March 23, 2009, DOE codified the 
current energy conservation standards, prescribed by EISA, for GSILs 
manufactured after January 1, 2012; January 1, 2013; or January 1, 
2014. 74 FR 12058. These standards require a color rendering index 
(``CRI'') greater than or equal to 80 for standard spectrum lamps (or 
greater than or equal to 75 for modified spectrum lamps) and, for four 
specified lumen ranges, a rated wattage no greater than and a rated 
lifetime no less than the values set forth in DOE's regulations at 10 
CFR 430.32(x)(1) and repeated in Table II.1 and Table II.2 of this 
document.

                   Table II.1--Federal Energy Efficiency Standards for Standard Spectrum GSILs
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                                                                                   Minimum rate
                       Rated lumen ranges                          Maximum rate      life-time       Effective
                                                                      wattage          (hrs)           date
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1490-2600.......................................................              72           1,000        1/1/2012
1050-1489.......................................................              53           1,000        1/1/2013
750-1049........................................................              43           1,000        1/1/2014
310-749.........................................................              29           1,000        1/1/2014
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                  Table II.2--Federal Energy Conservation Standards for Modified Spectrum GSILs
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                                                                                   Minimum rate
                       Rated lumen ranges                          Maximum rate      life-time       Effective
                                                                      wattage          (hrs)           date
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1118-1950.......................................................              72           1,000        1/1/2012
788-1117........................................................              53           1,000        1/1/2013
563-787.........................................................              43           1,000        1/1/2014
232-562.........................................................              29           1,000        1/1/2014
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2. History of Standards Rulemaking for GSILs
    GSILs are a subset of GSLs. As described in section II.A, EPCA 
directed DOE to conduct two rulemaking cycles to evaluate energy 
conservation standards for GSLs and outlined several specific criteria 
for each rulemaking cycle. DOE initiated the first GSL standards 
rulemaking process by publishing in the Federal Register a notice of a 
public meeting and availability of a framework document. 78 FR 73737 
(December 9, 2013); see also 79 FR 73503 (December 11, 2014) (notice of 
public meeting and availability of preliminary analysis). DOE later 
issued a notice of proposed rulemaking (NOPR) to propose amended energy 
conservation standards for GSLs. 81 FR 14528, 14629-14630 (March 17, 
2016) (the March 2016 GSL NOPR). The March 2016 GSL NOPR focused on the 
first question that Congress directed DOE to consider--whether to amend 
energy conservation standards for general service lamps. (42 U.S.C. 
6295(i)(6)(A)(i)(I)) In the March 2016 GSL NOPR proposing energy 
conservation standards for GSLs, DOE stated that it would be unable to 
undertake any analysis regarding GSILs and other incandescent lamps 
because of a then applicable congressional restriction (the 
Appropriations Rider \4\) on the use of appropriated funds to implement 
or enforce 10 CFR 430.32(x). 81 FR 14528, 14540-14541 (March 17, 2016). 
Notably, the applicability of this Appropriations Rider, which had been

[[Page 71630]]

extended in multiple appropriations through 2017, is no longer in 
effect.\5\
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    \4\ Section 312 of the Consolidated and Further Continuing 
Appropriations Act, 2016 (Pub. L. 114-113, 129 Stat. 2419) prohibits 
expenditure of funds appropriated by that law to implement or 
enforce: (1) 10 CFR 430.32(x), which includes maximum wattage and 
minimum rated lifetime requirements for GSILs; and (2) standards set 
forth in section 325(i)(1)(B) of EPCA (42 U.S.C. 6295(i)(1)(B)), 
which sets minimum lamp efficiency ratings for incandescent 
reflector lamps.
    \5\ See, the Consolidated Appropriations Act of 2017 (Pub. L. 
115-31, div. D, tit. III); See also, Consolidated Appropriations 
Act, 2018 (Pub. L. 115-141); Continuing Appropriations Act, 2019 
(Pub. L. 115-245).
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    In response to comments on the March 2016 GSL NOPR, DOE published a 
notice of proposed definition and data availability (``NOPDDA''), which 
proposed to amend the definitions of GSIL, GSL, and other supporting 
terms. 81 FR 71794, 71815 (Oct. 18, 2016). DOE explained that the 
October 2016 NOPDDA related to the second question that Congress 
directed DOE to consider--whether ``the exemptions for certain 
incandescent lamps should be maintained or discontinued,'' and stated 
explicitly that the NOPDDA was not a rulemaking to establish an energy 
conservation standard for GSLs. (42 U.S.C. 6295(i)(6)(A)(i)(II)); see 
also 81 FR 71798. The relevant ``exemptions,'' DOE explained, referred 
to the 22 categories of incandescent lamps that are statutorily 
excluded from the definitions of GSIL and GSL. 81 FR 71798. In the 
October 2016 NOPDDA, DOE clarified that it was defining what lamps 
constitute GSLs so that manufacturers could understand how any 
potential energy conservation standards might apply to the market. Id.
    On January 19, 2017, DOE published two final rules concerning the 
definition of GSL and related terms. 82 FR 7276; 82 FR 7322. The 
January 2017 definition final rules amended the definitions of GSIL and 
GSL by bringing certain categories of lamps that had been excluded by 
statute from the definition of GSIL within the definitions of GSIL and 
GSL. Like the October 2016 NOPDDA, DOE stated that the January 2017 
definition final rules related only to the second question that 
Congress directed DOE to consider, regarding whether to maintain or 
discontinue certain ``exemptions.'' (42 U.S.C. 6295(i)(6)(A)(i)(II)). 
That is, neither of the two final rules issued on January 19, 2017, 
purported to establish energy conservation standards applicable to 
GSLs.
    With the removal of the Appropriations Rider in the Consolidated 
Appropriations Act, 2017, DOE is no longer restricted from undertaking 
analysis and decision making required by the first question presented 
by Congress, i.e., whether to amend energy conservation standards for 
general service lamps, including GSILs. Thus, on August 15, 2017, DOE 
published a notice of data availability (NODA) and request for 
information seeking data for GSILs and other incandescent lamps. 82 FR 
38613 (August 2017 NODA). The purpose of this NODA was to assist DOE in 
making a decision on the first question posed to DOE by Congress; i.e., 
a determination regarding whether standards for GSILs should be 
amended. Comments submitted in response to the NODA also led DOE to re-
consider the decisions it had already made with respect to the second 
question presented to DOE; i.e., whether the exemptions for certain 
incandescent lamps should be maintained or discontinued. As a result of 
the comments received in response to the August 2017 NODA, DOE re-
assessed the legal interpretations underlying certain decisions made in 
the January 2017 definition final rules and issued a NOPR on February 
11, 2019 to withdraw the revised definitions of GSL, GSIL, and the 
supporting definitions established in the January 2017 definition rules 
(the February 2019 NOPR). 84 FR 3120. DOE held a public meeting on 
February 28, 2019 to hear oral comments and solicit information and 
data relevant to the February 2019 NOPR. Representatives for 
manufacturers, trade associations, environmental and energy efficiency 
advocates, and other interested parties attended the meeting. On 
September 5, 2019, DOE published a final rule withdrawing the revised 
definitions of GSL, GSIL, and supplemental terms established in the 
January 2017 definition final rules and maintaining the existing 
definitions of GSL and GSIL currently found in DOE's regulations (the 
2019 GSL Definition Rule). 84 FR 46661.
    DOE used the data and comments received in response to the August 
2017 NODA and any relevant data and comments received in response to 
the February 2019 NOPR to conduct an analysis of whether energy 
conservation standards for GSILs need to be amended. DOE published a 
notice of proposed determination on September 5, 2019 that proposed not 
to amend standards for GSILs because more stringent standards were not 
economically justified. 84 FR 46830. DOE considers comments received in 
response to the September 2019 GSIL NOPD in this final determination.
    In addition to comments received at the public meeting, DOE 
received 24,166 written comments in response to the September 2019 GSIL 
NOPD contained in 105 documents posted in the docket at https://www.regulations.gov/docket?D=EERE-2019-BT-STD-0022. The organizations 
that submitted written comments or commented at the public meeting are 
listed in Table II.3.

                    Table II.3--September 2019 GSIL NOPD Written Comments From Organizations
----------------------------------------------------------------------------------------------------------------
         Organization(s)            Reference in this final determination            Organization Type
----------------------------------------------------------------------------------------------------------------
Alliance to Save Energy..........  ASE...................................  Efficiency Organization.
American Institute of Architects.  AIA...................................  Trade Association.
Appliance Standards Awareness      ASAP..................................  Efficiency Organization.
 Project.
Appliance Standards Awareness      Joint Advocates.......................  Efficiency Organizations.
 Project, American Council for an
 Energy Efficient Economy,
 Natural Resources Defense Fund,
 and National Consumer Law Center.
Attorneys General of NY, CA, CO,   State Attorneys General...............  State/Federal Official or Agency.
 CT, DC, IL, MA, MD, ME, MI, MN,
 NJ, NV, OR, VE, WA, New York
 City.
California Energy Commission.....  CEC...................................  State/Federal Official or Agency.
Colorado Energy Office and         State of Colorado.....................  State/Federal Official or Agency.
 Colorado Department of Health
 and the Environment.
Competitive Enterprise Institute,  Free Market Organizations.............  Free Market Organizations.
 The Heritage Foundation, Eagle
 Forum, FreedomWorks Foundation,
 Thomas Jefferson Institute for
 Public Policy, Rio Grande
 Foundation, Nevada Policy
 Research Institute, Tradition
 Family Property Inc., Committee
 for a Constructive Tomorrow,
 Americans for Prosperity, Ethan
 Allen Institute, National Center
 for Public Policy Research and
 Project 21, and The Heartland
 Institute, 60 Plus Association
 (CEI et al).

[[Page 71631]]

 
Consumer Federation of America...  CFA...................................  Consumer Advocate.
Fourteen U.S. Senators (Edward J.  U.S. Senators.........................  State/Federal Official or Agency.
 Markey, Jeanne Shaheen, Maria
 Cantwell, Patty Murray, Tina
 Smith, Sheldon Whitehouse,
 Richard Blumenthal, Mazie K.
 Hirono, Jeffrey A. Merkley, Jack
 Reed, Bernard Sanders, Ron
 Wyden, Chris Van Hollen, and
 Catherine Cortez Masto).
Edison Electric Institute........  EEI...................................  Utility Association.
General Electric Lighting........  GE....................................  Manufacturer.
Institute for Policy Integrity...  IPI...................................  Think Tank.
National Electrical Manufacturers  NEMA..................................  Trade Association.
 Association.
Natural Resources Defense Council  NRDC..................................  Efficiency Organization.
Northwest Power and Conservation   NPCC..................................  Regional Agency/Association.
 Council.
Pacific Gas and Electric,          CA IOUs...............................  Utilities.
 Southern California Edison, San
 Diego Gas and Electric.
Pennsylvania Department of         PA DEP................................  State/Federal Official or Agency.
 Environmental Protection.
Sierra Club and Earthjustice.....  Sierra Club and Earthjustice..........  Efficiency Organizations.
Westinghouse Lighting............  Westinghouse..........................  Manufacturer.
----------------------------------------------------------------------------------------------------------------

    In addition to the comments from organizations listed in Table 
II.3, DOE received over 80 comments from individuals and 24,060 
comments submitted by individuals via form letter. A parenthetical 
reference at the end of a comment quotation or paraphrase provides the 
location of the item in the public record.\6\
---------------------------------------------------------------------------

    \6\ The parenthetical reference provides a reference for 
information located in the docket of DOE's rulemaking to evaluate 
energy conservation standards for GSILs. (Docket No. EERE-2019-BT-
STD-0022, which is maintained at https://www.regulations.gov/#!docketDetail;D=EERE-2019-BT-STD-0022). The references are arranged 
as follows: (Commenter name, comment docket ID number at page of 
that document).
---------------------------------------------------------------------------

III. General Discussion

A. Product Classes and Scope of Coverage

    When evaluating and establishing energy conservation standards, DOE 
divides covered products into product classes by the type of energy 
used or by capacity or other performance-related features that justify 
differing standards. In making a determination whether a performance-
related feature justifies a different standard, DOE must consider such 
factors as the utility of the feature to the consumer and other factors 
that DOE determines are appropriate. (42 U.S.C. 6295(q)) The product 
classes for this final determination are discussed in further detail in 
section VI.A.5 of this document. This final determination covers GSILs 
as currently defined in 10 CFR 430.2, which is the same as the 
statutory definition for GSIL. The scope of coverage is discussed in 
further detail in section VI.A.1 of this document.

B. Test Procedure

    EPCA sets forth generally applicable criteria and procedures for 
DOE's adoption and amendment of test procedures. (42 U.S.C. 6293) 
Manufacturers of covered products must use these test procedures to 
certify to DOE that their product complies with energy conservation 
standards and to quantify the efficiency of their product. DOE's 
current energy conservation standards for GSILs are expressed in terms 
of a maximum rated wattage and a minimum rated lifetime. (See 10 CFR 
430.32(x))
    A final rule published on July 6, 2009, revised the test procedure 
for GSILs to reflect the energy conservation standards prescribed by 
EISA. The July 2009 final rule concluded that GSILs do not operate in 
standby or off mode. 74 FR 31829. DOE published a test procedure final 
rule on January 27, 2012, establishing a revised active mode test 
procedure for GSILs. 77 FR 4203. The test procedure for GSILs is 
codified in appendix R to subpart B of 10 CFR part 430.
    DOE has since published a request for information (``RFI'') to 
initiate a data collection process to consider whether to amend DOE's 
test procedures for general service fluorescent lamps, GSILs, and 
incandescent reflector lamps (``IRLs''). 82 FR 37031 (August 8, 2017).

C. Technological Feasibility

1. General
    In each energy conservation standards rulemaking, DOE conducts a 
screening analysis based on information gathered on all current 
technology options and prototype designs that could improve the 
efficiency of the products or equipment that are the subject of the 
rulemaking. As the first step in such an analysis, DOE develops a list 
of technology options for consideration in consultation with 
manufacturers, design engineers, and other interested parties. DOE then 
determines which of those means for improving efficiency are 
technologically feasible. DOE considers technologies incorporated in 
commercially available products or in working prototypes to be 
technologically feasible. 10 CFR part 430, subpart C, appendix A, 
section 4(a)(4)(i)
    After DOE has determined that particular technology options are 
technologically feasible, it further evaluates each technology option 
in light of the following additional screening criteria: (1) 
Practicability to manufacture, install, and service; (2) adverse 
impacts on product utility or availability; and (3) adverse impacts on 
health or safety. 10 CFR part 430, subpart C, appendix A, section 
4(a)(4)(ii)-(iv) Additionally, it is DOE policy not to include in its 
analysis any proprietary technology that is a unique pathway to 
achieving a certain efficiency level. Section VI.A.4 of this document 
discusses the results of the screening analysis for GSILs, particularly 
the designs that DOE considered, those that DOE screened out, and those 
that are the basis for the standards considered in this final 
determination. For further details on the screening analysis for this 
rulemaking, see chapter 4 of the final determination technical support 
document (``TSD'').
2. Maximum Technologically Feasible Levels
    When DOE evaluates an amended standard for a type or class of 
covered

[[Page 71632]]

product, it must determine the maximum improvement in energy efficiency 
or maximum reduction in energy use that is technologically feasible for 
such product. (42 U.S.C. 6295(p)(1)) Accordingly, in the engineering 
analysis, DOE determined the maximum technologically feasible (``max-
tech'') improvements in energy efficiency for GSILs, using the design 
parameters for the most efficient products available on the market or 
in working prototypes. The max-tech levels that DOE determined for this 
rulemaking are described in section VI.B.3 of this final determination 
and in chapter 5 of the final determination TSD.

D. Energy Savings

1. Determination of Savings
    For each trial standard level (``TSL''), DOE projected energy 
savings from application of a TSL to GSILs purchased in the 30-year 
period that begins in the year of compliance with the potential amended 
standards (2023-2052).\7\ The savings are measured over the entire 
lifetime of the GSILs and substitute lamps purchased in the 30-year 
analysis period. DOE quantified the energy savings attributable to a 
TSL as the difference in energy consumption between each standards case 
and the no-new-standards case. The no-new-standards case represents a 
projection of energy consumption that reflects how the market for a 
product would likely evolve in the absence of amended energy 
conservation standards. In this case, the standards case represents 
energy savings not from the technology outlined in a TSL, but from 
product substitution as consumers are priced out of the market for 
GSILs.
---------------------------------------------------------------------------

    \7\ DOE also presents a sensitivity analysis that considers 
impacts for products shipped in a 9-year period.
---------------------------------------------------------------------------

    DOE used its national impact analysis (``NIA'') spreadsheet model 
to estimate national energy savings (``NES'') from potential amended 
standards for GSILs. The NIA spreadsheet model (described in section 
VI.G of this document) calculates energy savings in terms of site 
energy, which is the energy directly consumed by products at the 
locations where they are used. For electricity, DOE reports national 
energy savings in terms of site energy savings and source energy 
savings, the latter of which is the savings in the energy that is used 
to generate and transmit the site electricity. DOE also calculates NES 
in terms of full-fuel-cycle (``FFC'') energy savings. The FFC metric 
includes the energy consumed in extracting, processing, and 
transporting primary fuels (i.e., coal, natural gas, petroleum fuels), 
and thus presents a more complete picture of the impacts of energy 
conservation standards.\8\ DOE's approach is based on the calculation 
of an FFC multiplier for each of the energy types used by covered 
products or equipment. For more information on FFC energy savings, see 
section VI.G.1 of this document.
---------------------------------------------------------------------------

    \8\ The FFC metric is discussed in DOE's statement of policy and 
notice of policy amendment. 76 FR 51282 (Aug. 18, 2011), as amended 
at 77 FR 49701 (Aug. 17, 2012).
---------------------------------------------------------------------------

2. Significance of Savings
    In determining whether amended standards are needed, DOE must 
consider whether such action would result in significant energy 
savings. (42 U.S.C. 6295(m)(1)(A)) Congress did not define the 
statutory term ``significant conservation of energy,'' and heretofore 
DOE's approach to this criteria has been inconsistent. To address this 
gap, DOE recently proposed to define a significant energy savings 
threshold in the ``Process Rule''. 84 FR 3910 (February 13, 2019). 
Specifically, DOE stated that it is considering using a two-step 
approach that would consider both a quad threshold value (over a 30-
year period) and a percentage threshold value to ascertain whether a 
potential standard satisfies 42 U.S.C. 6295(o)(3)(B) to ensure that DOE 
avoids setting a standard that ``will not result in significant 
conservation of energy.'' 84 FR 3901, 3924. DOE's updates to the 
Process Rule have not yet been finalized and thus DOE is not applying 
the threshold proposed in the Process Rule update at this time.

E. Economic Justification

1. Specific Criteria
    EPCA provides seven factors to be evaluated in determining whether 
a potential energy conservation standard is economically justified. (42 
U.S.C. 6295(o)(2)(B)(i)(I)(VII)) The following sections discuss how DOE 
has addressed each of those seven factors in this rulemaking.
a. Economic Impact on Manufacturers and Consumers
    In determining the impacts of potential amended standards on 
manufacturers, DOE conducts a manufacturer impact analysis (``MIA''), 
as discussed in section VI.H of this document. DOE first uses an annual 
cash-flow approach to determine the quantitative impacts. This step 
includes both a short-term assessment--based on the cost and capital 
requirements during the period between when a regulation is issued and 
when entities must comply with the regulation--and a long-term 
assessment over a 30-year period. The industry-wide impacts analyzed 
include (1) industry net present value (``INPV''), which values the 
industry on the basis of expected future cash flows; (2) cash flows by 
year; (3) changes in revenue and income; and (4) other measures of 
impact, as appropriate. Second, DOE analyzes and reports the impacts on 
different types of manufacturers, including impacts on small 
manufacturers. Third, DOE considers the impact of standards on domestic 
manufacturer employment and manufacturing capacity, as well as the 
potential for standards to result in plant closures and loss of capital 
investment. Finally, DOE takes into account cumulative impacts of 
various DOE regulations and other regulatory requirements on 
manufacturers.
    For individual consumers, measures of economic impact include the 
changes in life-cycle cost (``LCC'') and payback period (``PBP'') 
associated with new or amended standards. These measures are discussed 
further in the following section. For consumers in the aggregate, DOE 
also calculates the national net present value of the consumer costs 
and benefits expected to result from particular standards. DOE also 
evaluates the impacts of potential standards on identifiable subgroups 
of consumers that may be affected disproportionately by a standard. 
However, because DOE has concluded that amended standards for GSILs 
would not be economically justified for the potential standard levels 
evaluated based on the PBP analysis, DOE did not conduct an LCC 
subgroup analysis for this notice.
b. Savings in Operating Costs Compared to Increase in Price (LCC and 
PBP)
    EPCA requires DOE to consider the savings in operating costs 
throughout the estimated average life of the covered product compared 
to any increase in the price of the covered product that is likely to 
result from a standard. (42 U.S.C. 6295(o)(2)(B)(i)(II)) DOE conducts 
this comparison in its LCC and PBP analysis.
    The LCC is the sum of the purchase price of a product (including 
its installation) and the operating cost (including energy, 
maintenance, and repair expenditures) discounted over the lifetime of 
the product. To account for uncertainty and variability in specific 
inputs, such as product lifetime and discount rate, DOE uses a 
distribution of values, with probabilities attached to each value. For 
its LCC analysis, DOE assumes that any purchases of the covered product 
occur

[[Page 71633]]

in the first year of compliance with potential amended standards.
    As described previously, the statutory factor addressed in this 
analysis is the savings in operating costs throughout the estimated 
average life of the covered product in the type (or class) compared to 
any increase in the price of, or in the initial charges for, or 
maintenance expenses of, the covered products which are likely to 
result from the imposition of the standard (emphasis added). DOE's 
determination regarding economic justification must be based on LCC 
savings occurring as a result of the imposition of an amended standard 
for the covered product, i.e., GSILs. Separately, EPCA prohibits DOE 
from prescribing an amended or new standard if doing so is likely to 
result in the unavailability in the United States in any covered 
product type (or class) of performance characteristics (including 
reliability), features, sizes, capacities, and volumes that are 
substantially the same as those generally available in the United 
States at the time of the Secretary's finding (emphasis added). 
Accordingly, while DOE presents the LCC savings under a substitution 
scenario,\9\ DOE cannot, in this determination, consider those LCC 
savings in making a determination as to whether amended standards for 
the covered product are economically justified because those LCC 
savings result from the unavailability of the covered product.
---------------------------------------------------------------------------

    \9\ Throughout this document, when DOE refers to the LCC savings 
for the substitution scenario, DOE is referring to the projected 
savings that could be achieved in a substitution scenario.
---------------------------------------------------------------------------

    The LCC savings for the considered standard levels are calculated 
relative to the no-new-standards case and the PBP for the considered 
efficacy levels are calculated relative to the baseline. DOE's LCC and 
PBP analysis is discussed in further detail in section VI.E of this 
document.
c. Energy Savings
    Although significant conservation of energy is a separate statutory 
requirement for adopting an energy conservation standard, EPCA requires 
DOE, in determining the economic justification of a 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 
discussed in section VI.G, DOE uses the NIA spreadsheet models to 
project national energy savings.
d. Lessening of Utility or Performance of Products
    In establishing product classes, and in evaluating design options 
and the impact of potential standard levels, DOE evaluates potential 
standards that would not lessen the utility or performance of the 
considered products. (42 U.S.C. 6295(o)(2)(B)(i)(IV)) The Secretary may 
not prescribe an amended or new standard if the Secretary finds (and 
publishes such finding) that interested persons have established by a 
preponderance of the evidence that the standard is likely to result in 
the unavailability in the United States in any covered product type (or 
class) of performance characteristics (including reliability), 
features, sizes, capacities, and volumes that are substantially similar 
in the United States at the time of the Secretary's finding. (42 U.S.C. 
6295(o)(4))
e. Impact of Any Lessening of Competition
    EPCA directs DOE to consider the impact of any lessening of 
competition, as determined in writing by the Attorney General, that is 
likely to result from a standard. (42 U.S.C. 6295(o)(2)(B)(i)(V)) 
Because DOE is not amending a standard, DOE did not transmit its 
rulemaking to the Attorney General under this provision.
f. Need for National Energy Conservation
    In evaluating the need for national energy conservation, DOE 
expects that energy savings from amended standards would likely provide 
improvements to the security and reliability of the nation's energy 
system. Reductions in the demand for electricity also may result in 
reduced costs for maintaining the reliability of the nation's 
electricity system. Energy savings from amended standards also would 
likely result in environmental benefits in the form of reduced 
emissions of air pollutants and greenhouse gases primarily associated 
with fossil-fuel based energy production. Consistent with its past 
approach,\10\ because DOE has concluded amended standards for GSILs 
would not be economically justified for potential standard levels 
evaluated based on the PBP analysis, DOE did not conduct a utility 
impact analysis or emissions analysis for this notice.
---------------------------------------------------------------------------

    \10\ See 81 FR 71325 (Oct. 17, 2016).
---------------------------------------------------------------------------

g. 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)) 
In this final determination, DOE based its analysis of economic 
justification on the second factor in 42 U.S.C. 6295(o)(2)(B)(i), 
namely, that the energy savings in operating costs of the covered 
product are insufficient to recover the upfront cost.
2. Rebuttable Presumption
    As set forth in 42 U.S.C. 6295(o)(2)(B)(iii), EPCA creates a 
rebuttable presumption that an energy conservation standard is 
economically justified if the additional cost to the consumer of a 
product that meets the standard is less than three times the value of 
the first year's energy savings resulting from the standard, as 
calculated under the applicable DOE test procedure. DOE's LCC and PBP 
analyses generate values used to calculate the effect potential amended 
energy conservation standards would have on the payback period for 
consumers. These analyses include, but are not limited to, the 3-year 
payback period contemplated under the rebuttable-presumption test. In 
addition, DOE routinely conducts an economic analysis that considers 
the full range of impacts to consumers, manufacturers, the Nation, and 
the environment, as required under 42 U.S.C. 6295(o)(2)(B)(i). The 
results of this analysis serve as the basis for DOE's evaluation of the 
economic justification for a potential standard level (thereby 
supporting or rebutting the results of any preliminary determination of 
economic justification). The rebuttable presumption payback calculation 
is discussed in section VII.B.2 of this final determination.

IV. DOE's Proposal and Discussion of Related Comments

    Section V of this final rule addresses legal issues, section VI 
addresses comments on DOE's methodology, section VII contains the 
results of DOE's analysis, and section VII.E contains DOE's conclusion. 
DOE received several general comments expressing agreement or 
disagreement with DOE's proposed determination. NEMA, GE, Westinghouse, 
the Free Market Organizations, and one individual supported DOE's 
determination to not set more stringent standards for GSILs. (GE, No. 
78 at p. 1; Westinghouse, No. 112 at p. 1-2; Free Market Organizations, 
No. 111 at p. 2-3, 6-7; NEMA, No. 88 at p. 2, 6; Strauch, No. 69 at p. 
1) Additionally, several individuals stated that the incandescent lamp 
should not be banned.\11\

[[Page 71634]]

Conversely, fourteen U.S. Senators, the attorneys general of sixteen 
U.S. States, State agencies, energy efficiency organizations, 
utilities, a think tank, and many individuals disagreed with DOE's 
proposal to not set more stringent standards for GSILs.\12\ 
Additionally, fourteen U.S. Senators and other stakeholders stated that 
the Federal government should be acting to increase the use of energy 
efficient lighting products rather than back tracking or relaxing 
energy efficiency standards.\13\ There were also over 24,060 comments 
submitted by individuals via form letter that disagreed with DOE's 
proposal. (NRDC, No. 92 at spreadsheet attachment)
---------------------------------------------------------------------------

    \11\ See Smith, No. 31 at p. 1; Anonymous, No. 71 at p. 1; 
Brian, No. 72 at p. 1; Gazoobie, No. 75 at p. 1; Young, No. 99 at p. 
1; Oates, No. 20 at p. 1; Berry, No. 67 at p. 1; Baker, No. 34 at p. 
1, Baker, No. 30 at p. 1; Anonymous, No. 68 at p. 1; Anonymous, No. 
98 at p. 1.
    \12\ To improve readability, the citation was moved to a 
footnote: (Morgan, No. 55 at p. 1; NRDC, Public Meeting Transcript, 
No. 56 at p. 15; NPCC, No. 58 at p. 1; State of Colorado, No. 62 at 
p. 1; CFA, No. 76 at p. 1; PA DEP, No. 77 at p. 2; Covell, No. 94 at 
p. 1; State Attorneys General, No. 110 at p. 1; Coconut Moon, No. 35 
at p. 1; Goldman, No. 36 at p. 1; Simpson, No. 38 at p. 1; LeRoy, 
No. 40 at p. 1; Meadow, No. 41 at p. 1; Caswell, No. 44 at p. 1; H, 
No. 47 at p. 1; Kodama, No. 49 at p. 1; Schnapp, No. 14 at p. 1; 
Anonymous, No. 17 at p. 1; United States Senate, No. 60 at p. 1; 
ASAP, Public Meeting Transcript, No. 56 at pp. 17-18; CA IOUs, No. 
83 at p. 1; The Joint Advocates, No. 113 at p. 1-2; Rothenhaus, No. 
16 at p. 1; IPI, No. 96 at p. 8; Energy Solutions, Public Meeting 
Transcript, No. 56 at pp. 11-12).
    \13\ To improve readability, the citation was moved to a 
footnote: (Behl, No. 3 at p. 1; Katz, No. 26 at p. 1; AIA, No. 29 at 
pp. 1-2; Dufford, No. 32 at p. 1; Werner, No. 37 at p. 1; Gancarz-
Davies, No. 63 at p. 1; Masson, No. 73 at p. 1; Wodkowski, No. 91 at 
p. 1; IPI, No. 96 at p. 8; Indivisible Ventura, No. 100 at p. 1; 
Warren, No. 108 at p. 1; Blancq, No. 10 at p. 1; Sorkin, No. 13 at 
p. 1; Ting, No. 21 at p. 1; Das, No. 24 at p. 1; Knipe, No. 28 at p. 
1; Datz, No. 39 at p. 1; Galayda, No. 42 at p. 1; HS, No. 45 at p. 
1; Sorkin, No. 53 at p. 1; Dawes, No. 57 at p. 1; United States 
Senate, No. 60 at p. 1; Gsell, No. 64 at p. 1; Waller, No. 74 at p. 
1; Miller, No. 79 at p. 1; Waltman, No. 80 at p. 1; Murphy, No. 81 
at p. 1; Craven, No. 82 at p. 1; Combs, No. 84 at p. 1; Guttman, No. 
85 at p. 1; Bibito, No. 86 at p. 1; Bowe, No. 87 at p. 1; Anonymous, 
No. 89 at p. 1; Posakony, No. 90 at p. 1; Wodkowski, No. 91 at p. 1; 
Puckett, No. 93 at p. 1; Hemm, No. 103 at p. 1; Knight, No. 105 at 
p. 1; Anonymous, No. 107 at p. 1; MacKenzie, No. 109 at p. 1; 
Zimmerman, No. 50 at p. 1; Parker, No. 51 at p. 1; Rosenberg, No. 52 
at p. 1; Coyne, No. 54 at p. 1; Energy Solutions, Public Meeting 
Transcript, No. 56 at p. 10; Dashe, No. 61 at p. 1; Anonymous, No. 
70 at p. 1).
---------------------------------------------------------------------------

    NEMA and several individuals stated that consumer energy savings 
resulting from amending conservation standards for incandescent lamps 
will not be substantial enough to significantly impact consumers. 
(NEMA, No. 88 at pp. 4-5; Strauch, No. 69 at p. 1; Anonymous, No. 98 at 
p. 7; Anonymous, No. 98 at pp. 15-16) NEMA further explained that the 
additional average annual cost for using GSILs in 2021 is minimal. 
(NEMA, No. 88 at p. 19) The Free Market Organizations stated that DOE 
analysis indicates a more stringent GSIL standard would make 
incandescent lamps prohibitively expensive and for all practical 
purposes would be an outright ban making LED lamps the only viable 
choice. (Free Market Organizations, No. 111 at p. 4) An individual 
noted that banning lamps is an indirect way of targeting energy 
consumption and emissions. (Anonymous, No. 98 at pp. 8-9, 10, 17)
    In contrast, other commenters suggested that DOE's proposal to not 
amend standards would harm the environment and result in high energy 
costs for consumers due to continued sales of inefficient lamps.\14\ 
Several commenters indicated that continued manufacturing of 
incandescent lamps will lead to increases in waste resources.\15\ Other 
individuals said that continued use and manufacturing of incandescent 
lamps leads to increases in greenhouse gas emissions, and therefore 
increases the risk of health issues such as respiratory and 
cardiovascular effects. (Anonymous, No. 70 at p. 2; Miller, No. 79 at 
p. 1; Indivisible Ventura, No. 100 at p. 1; Knight, No. 105 at p. 1; 
Warren, No. 108 at p. 1) NPCC stated that DOE's proposal to not amend 
GSIL standards could significantly increase Northwest electricity loads 
that will need to be offset through utility energy efficiency programs, 
which could result in higher costs and less equitable distribution of 
savings. (NPCC, No. 58 at p. 2) The 24,060 individual commenters stated 
that DOE's proposal is in conflict with the intent of legislation 
passed 12 years ago to ensure improved efficiency standards for light 
bulbs starting in January 1, 2020. (NRDC, No. 92 at spreadsheet 
attachment)
---------------------------------------------------------------------------

    \14\ To improve readability, the citation was moved to a 
footnote: (CFA, No. 76 at pp. 2-4; NRDC, No. 97 at pp. 1-2; 
MacKenzie, No. 109 at p. 1; Plano, No. 7 at p. 1; Kimble, No. 8 at 
p. 1; CFA, Public Meeting Transcript, No. 56 at p. 25; PA DEP, No. 
77 at p. 2; Warren, No. 108 at p. 1; Joint Advocates, No. 113 at p. 
1-2; State Attorneys General, No. 110 at p. 1-2, 12, 28; Morgan, No. 
55 at p. 1).
    \15\ To improve readability, the citation was moved to a 
footnote: (Barrett, No. 15 at p. 1; Das, No. 24 at p. 1; Hill, No. 
25 at p. 1; AIA, No. 29 at p. 1-2; Baker, No. 30 at p. 1; Dufford, 
No. 32 at p. 1; Werner, No. 37 at p. 1; Datz, No. 39 at p. 1; 
Kodama, No. 48 at p. 1; Zimmerman, No. 50 at p. 1; Rosenberg, No. 52 
at p. 1; Sorkin, No. 53 at p. 1; Coyne, No. 54 at p. 1; Morgan, No. 
55 at p. 1; Energy Solutions, Public Meeting Transcript, No. 56 at 
p. 12; Dawes, No. 57 at p. 1; United States Senate, No. 60 at p. 1; 
Dashe, No. 61 at p. 1; Gsell, No. 64 at p. 1; Anonymous, No. 66 at 
p. 1; Anonymous, No. 70 at p. 1; Anonymous, No. 70 at p. 2; Craven, 
No. 82 at p. 1; Combs, No. 84 at p. 1; Anonymous, No. 89 at p. 1; 
CFA, No. 76 at p. 13; PA DEP, No. 77 at p. 2; IPI, No. 96 at p. 8; 
NRDC, No. 97 at pp. 1-3; Indivisible Ventura, No. 100 at p. 1; 
Knight, No. 105 at p. 1; Warren, No. 106 at p. 1; MacKenzie, No. 109 
at p. 1; Joint Advocates, No. 113 at p. 1; NEMA, No. 88 at p. 20; 
State Attorneys General, No. 110 at p. 1, 23, 25, 27, 28; Anonymous, 
No. 98 at p. 25; Behl, No. 3 at p. 1; Sorkin, No. 13 at p. 1; 
Parker, No. 51 at p. 1; State of Colorado, No. 62 at p. 1; NRDC, No. 
92 at p. 1; Coconut Moon, No. 35 at p. 1; Greacen, No. 6 at p. 1; 
Solutions by Design, No. 2 at p. 1; Guttman, No. 85 at p. 1; CFA, 
No. 76 at p. 3).
---------------------------------------------------------------------------

    Many stakeholders commented on the economic benefit for consumers 
of the 45 lumens per watt backstop requirement applying to all lamps 
included in the January 2017 GSL definition. 82 FR 7276 (January 19, 
2017) and 82 FR 7322 (January 19, 2017). Specifically, several 
commenters indicated that lighting standards for efficient lamps such 
as CFLs and LED lamps would allow consumers to realize energy savings 
of as much as $20 (CFA, No. 76 at p. 3, 17-18) to $55 (NRDC, No. 97 at 
p. 2) per lamp over a 10-year period or $100 (NRDC, No. 97 at p. 3) by 
2025 to $180 (ASE, No. 95 at p. 2) per average household per year. One 
commenter indicated that cumulatively, consumers would save as much as 
$1.7 billion on bulb purchases in 2025 if such standards are in place. 
(Vondrasek, No. 101 at p. 4) The 24,060 individual commenters and many 
other stakeholders stated that withdrawing the January 2017 GSL 
definition and not adopting the 45 lumen per watt backstop would cost 
Americans up to $14 billion in electricity bills as of 2025 and would 
increase electricity usage by as much as 25 power plants annually, 
thereby increasing carbon emissions.\16\
---------------------------------------------------------------------------

    \16\ To improve readability, the citation was moved to a 
footnote: (NRDC, No. 92 at spreadsheet attachment; AIA, No. 29 at p. 
2; NRDC, Public Meeting Transcript, No. 56 at p. 14; Dawes, No. 57 
at p. 1; CFA, No. 76 at p. 13; United States Senate, No. 60 at p. 1; 
Indivisible Ventura, No. 100 at p. 1; State of Colorado, No. 62 at 
p. 1; Energy Solutions, Public Meeting Transcript, No. 56 at p. 12; 
PA DEP, No. 77 at p. 2; IPI, No. 96 at p. 8; CFA, No. 76 at p. 22).
---------------------------------------------------------------------------

    Several individuals submitted comments stating that more efficient 
lamps save consumers money and reduce greenhouse gas emissions.\17\ 
Specifically, several commenters stated that applying the 45 lumens per 
watt backstop requirement to the lamps in the January 2017 GSL 
definition would save an estimated 38 million tons of carbon emissions 
annually and generate approximately $1.9 billion per year in climate 
benefits. (NRDC, Public Meeting Transcript, No. 56 at p. 14; ASE, No. 
95 at p. 2; IPI, No. 96 at p. 4)
---------------------------------------------------------------------------

    \17\ To improve readability, the citation was moved to a 
footnote: (Coconut Moon, No. 35 at p. 1; Goldman, No. 36 at p. 1; 
Werner, No. 37 at p. 1; Simpson, No. 38 at p. 1; Datz, No. 39 at p. 
1; LeRoy, No. 40 at p. 1; Meadow, No. 41 at p. 1; Caswell, No. 44 at 
p. 1; H, No. 47 at p. 1; Kodama, No. 49 at p. 1; Rosenberg, No. 52 
at p. 1; Dashe, No. 61 at p. 1).
---------------------------------------------------------------------------

    The Joint Advocates asserted that DOE's proposal to not amend GSIL

[[Page 71635]]

standards is an attempt to slow the transition to LED lamps and that it 
will waste energy and dollars and damage the environment. ASE stated 
that DOE's decision to publish this proposal will cause needless market 
uncertainty less than one year before new standards are set to take 
effect. (ASE, No. 95 at p. 3) The State Attorneys General stated that 
the backstop has already made an impact in the industry where 
manufacturers, retailers, consumers, and regulators have already 
anticipated the backstop standard going into effect. (State Attorneys 
General, No. 110 at pp. 9-10) CFA argued that DOE's proposal could lead 
to less shelf space for efficient light bulbs, making it more difficult 
for consumers to locate the efficient products that best meet their 
needs. (CFA, No. 76 at p. 7) The Joint Advocates strongly urged DOE to 
withdraw and redo its analysis. (Joint Advocates, No. 113 at XX.)
    NEMA commented that further regulation is unnecessary because the 
market will achieve energy conservation goals for GSLs as effectively 
as a regulatory approach and without unnecessary, incremental 
regulatory burden. NEMA noted that consumers have historically 
voluntarily chosen more efficient lamps without requirements of Federal 
energy conservation standards. NEMA submitted data to argue that more 
efficient GSL designs have had success in the market, and that the 
acceptance of such designs and actual (not ``potential'') market 
penetration warrant adoption of a non-regulatory approach in this case. 
(NEMA, No. 88 at pp. 3, 21-31) p. 1)
    DOE appreciates, and has considered, the comments that DOE has 
received regarding its proposal in the September 2019 GSIL NOPD.

V. Legal Issues and Discussion of Related Comments

A. Imposition of the Backstop

    By law, the Secretary was required to initiate a rulemaking by 
January 1, 2014 to determine whether standards in effect for GSLs 
should be amended and whether exemptions for certain incandescent lamps 
should be maintained or discontinued based, in part, on exempted lamp 
sales. (42 U.S.C. 6295(i)(6)(A)(i)) If the Secretary determined that 
standards in effect for GSILs should be amended, the Secretary was 
obligated to publish a final rule establishing such standards no later 
than January 1, 2017. (42 U.S.C. 6295(i)(6)(A)(iii)) If the Secretary 
made a determination that standards in effect for GSILs should be 
amended, failure by the Secretary to publish a final rule by January 1, 
2017, in accordance with the criteria in the law, would have resulted 
in the imposition of the backstop provision in 42 U.S.C. 
6295(i)(6)(A)(v). That backstop requirement would have required that 
the Secretary prohibit the sale of any GSL that does not meet a minimum 
efficacy standard of 45 lm/W.
    DOE received numerous comments asserting that the 45 lm/W backstop 
standard applicable to GSLs in 42 U.S.C. 6295(i)(6)(A)(v) has been 
triggered and is to go into effect on January 1, 2020. Such commenters 
include the Sierra Club and Earthjustice, NRDC, the Joint Advocates, CA 
IOUs, CEC, the Attorneys General, U.S. Senators, ASE, CFA, and the PA 
DEP. These commenters contend that the backstop standard was triggered 
by DOE's failure to complete a rulemaking in accordance with 42 U.S.C. 
6295(i)(6)(A)(i)-(iv) and applies to all GSLs, including GSILs. Thus, 
commenters argued that DOE's proposed determination is not authorized 
by EPCA and that any final determination would be without legal effect. 
(See the State Attorneys General, No. 110 at p. 7; CEC, No. 102 at 3; 
Sierra Club and Earthjustice, No. 104 at 1; Joint Advocates, No. 113 at 
3) The State Attorneys General argued against DOE's assertion in the 
2019 GSL Definition Rule that the backstop has not yet been triggered 
because 42 U.S.C. 6295(i)(6)(A)(iii) requires a final GSIL standards 
rule by January 1, 2017, only if DOE determines that standards for 
GSILs should be amended. (the State Attorneys General, No. 110 at p. 9) 
The State Attorneys General disagree with the notion that because DOE 
has yet to decide whether to amend the standard, it is not obliged to 
issue a final standard by any deadline and the backstop provision is 
not triggered. Id. The State Attorneys General believe that this 
interpretation of EPCA is inconsistent with the statutory language 
establishing the backstop and would render its inclusion in the statute 
meaningless. Id. The CA IOUs disagreed with DOE's assertion in the 2019 
GSL Definition Rule that it was unable to meet the statutory deadlines 
due to the limitations imposed by the Appropriations Rider, arguing 
that the Rider does not negate the reality that the backstop has been 
triggered. (CA IOUs, No. 83 at p. 2) Along these lines, the State 
Attorneys General argued that there is no basis to infer that Congress 
intended the Rider to suspend or repeal the schedule set forth in 42 
U.S.C. 6295(i)(6)(A), and as a result the Rider is irrelevant as to 
whether the backstop was triggered. (the State Attorneys General, No. 
110 at p. 10)
    DOE received many comments relying on DOE's alleged failure to 
complete the deadlines set forth in 42 U.S.C. 6295(i)(6)(A) as evidence 
that DOE has triggered the backstop provision. As discussed in the 2019 
GSL Definition Rule, DOE initiated the first GSL standards rulemaking 
process by publishing a notice of availability of a framework document 
in December 2013, which satisfied the requirements in 42 U.S.C. 
6295(i)(6)(A)(i) to initiate a rulemaking by January 1, 2014. DOE 
subsequently issued the March 2016 NOPR proposing energy conservation 
standards for GSLs, but was unable to undertake any analysis regarding 
GSILs and other incandescent lamps in the NOPR because of a then-
applicable Appropriations Rider. Once the Appropriations Rider was 
removed, DOE was able to undertake the analysis to determine whether 
standards for GSLs, including GSILs, should be amended per the 
requirements in 42 U.S.C. 6295(i)(6)(A)(i) and thus issued the 
September 2019 GSIL NOPD. This final rule completes DOE's obligation 
under the statute to determine whether standards for GSILs should be 
amended. There is no explicit deadline in 42 U.S.C. 6295(i)(6)(A)(iii) 
for making this negative determination, and Congress, through the 
Appropriations Rider, removed DOE's authority to make the required 
statutory determination regarding GSILs during the period the Rider was 
in effect. DOE did not regain the authority to make the determination 
regarding GSILs until the Rider was removed. Upon the removal of the 
Rider in 2017, DOE has worked swiftly to make the required 
determinations regarding incandescent lamps in 42 U.S.C. 6295(i)(6)(A). 
DOE is continuing to evaluate energy conservation standards for LEDs 
and CFLs and is working toward completing that task.
    With regard to comments on the January 1, 2017, statutory deadline 
for the Secretary to complete a rulemaking for GSILs in 42 U.S.C. 
6295(i)(6)(A)(iii), this deadline is premised on the Secretary's first 
making a determination that standards for GSILs should be amended. The 
Secretary fails to meet the requirement in 42 U.S.C. 6295(i)(6)(A)(iii) 
only if he (1) determines that standards for GSILs should be amended; 
and then (2) fails to publish a rule prescribing standards by January 
1, 2017. That is, 42 U.S.C. 6295(i)(6)(A)(iii) does not establish an 
absolute obligation on the Secretary to publish a rule by a date 
certain, as is the case in numerous other provisions in EPCA. See 42 
U.S.C. 6295(e)(4); 42

[[Page 71636]]

U.S.C. 6295(u)(1)(A); and 42 U.S.C. 6295(v)(1). Rather, the obligation 
to issue a final rule prescribing standards by a date certain applies 
if, and only if, the Secretary makes a determination that standards in 
effect for GSILs need to be amended. Interpreting the statute otherwise 
would suggest that, if the Secretary were to make a determination that 
standards in effect for GSILs do not need to be amended, the Secretary 
nonetheless would have an obligation to issue a final rule setting 
standards for those lamps that he determined did not necessitate 
amended standards. Although different readings of the statutory 
language have been suggested, it is DOE's conclusion that the best 
reading of the statute, is that Congress intended for the Secretary to 
make a predicate determination about whether the standards for GSILs 
should be amended, otherwise it could result in a situation where a 
prohibition is automatically imposed for a category of lamps for which 
no new standards, much less prohibition, are necessary. Since DOE now 
makes the predicate determination in this final rule that standards for 
GSILs do not need to be amended, the obligation to issue a final rule 
by a date certain does not exist and, as a result, the condition 
precedent to the potential imposition of the backstop requirement does 
not exist and no backstop requirement has been imposed.

B. EPCA's Anti-Backsliding Provision and Congressional Intent

    Commenters asserted that even if DOE were authorized to amend 
standards for GSILs per 42 U.S.C. 6295(i)(6)(A), EPCA's prohibition 
against backsliding at 42 U.S.C. 6295(o)(1) limits DOE's authority to 
determine whether standards should be increased from a baseline 
efficacy level of 45 lm/W established by the backstop. (the State 
Attorneys General, No. 110 at p. 8) Because, the commenters asserted, 
the proposed determination would increase the maximum allowable energy 
use for GSILs, a subset of GSLs, commenters argue that EPCA's anti-
backsliding provision forbids DOE from undertaking that action. (See 
the State Attorneys General, No. 110 at p. 8; Sierra Club and 
Earthjustice, No. 104 at p. 5; ASE, No. 95 at p. 3) The State Attorneys 
General noted that the anti-backsliding provision was intended to 
ensure progress toward higher efficiency standards and stability. 
Against this backdrop, these commenters stated that it defies credulity 
that Congress would have granted DOE unfettered discretion to avoid the 
backstop by issuing a determination not to amend nearly three years 
after the deadline Congress set for DOE to carry out its rulemaking 
responsibilities. (the State Attorneys General, No. 110 at p. 11) The 
State Attorneys General pointed to the Energy Independence and Security 
Act of 2007's (EISA's) legislative history as revealing clear 
congressional intent to rapidly transition the nation to more energy 
efficient lighting through, among other things, the elimination of 
inefficient, incandescent bulbs by 2020. (Id. at p. 10.) Along these 
lines, the Sierra Club and Earthjustice commented that Congress did not 
authorize DOE to issue a finding that standards in effect for GSILs 
should not be amended, because Congress designed the backstop to take 
effect unless displaced by a DOE rulemaking that would achieve greater 
energy savings. (Sierra Club and Earthjustice, No. 104 at p. 6)
    The anti-backsliding provision at 42 U.S.C. 6295(o)(1) precludes 
DOE from amending an existing energy conservation standard to permit 
greater energy use or a lesser amount of energy efficiency. This 
provision is inapplicable to the current rulemaking because DOE has not 
established an energy conservation standard for GSLs from which to 
backslide. Commenters' assertions that the anti-backsliding provision 
has been violated hinge on the assumption that the backstop requirement 
for GSLs in 42 U.S.C 6295(i)(6)(A)(v) has been triggered and is 
currently in effect. However, DOE makes clear in this rule that because 
it has made the predicate determination not to amend standards for 
GSILs, there is no obligation to issue a final rule by January 1, 2017, 
and thus the backstop sales prohibition has not been triggered and is 
not in effect. Any discussion of backsliding is therefore misplaced. 
Furthermore, the determination DOE makes in this rulemaking is that the 
existing standards applicable to GSILs should remain as they are, i.e., 
that those standards do not need to be amended. As a result, this 
rulemaking is in no way reducing the standards applicable to the 
subject lamps.
    Additionally, as discussed in the 2019 GSL Definition Rule, even if 
the backstop requirement at 42 U.S.C. 6295(i)(6)(A)(v) were to apply, 
it would operate as a sales prohibition for any GSL that does not meet 
a minimum efficacy standard of 45 lm/W. The anti-backsliding provision 
states that the Secretary cannot prescribe any amended standard that 
would allow greater energy use or less efficiency. EPCA defines an 
energy conservation standard for consumer products as a performance 
standard that prescribes a minimum efficiency level or maximum quantity 
of energy usage for a covered product or, in certain circumstances, a 
design requirement. (42 U.S.C. 6291(6)) In contrast, a sales 
prohibition in EPCA is tied to whether a transaction in commerce can 
occur with respect to a covered product, but the prohibition is not 
itself a standard.\18\ Because the scope of a sales prohibition is not 
the same as a standard, the minimum efficacy of 45 lm/W mandated by the 
backstop's sales prohibition is unchanged by this final rule. The anti-
backsliding provision in 42 U.S.C. 6295(o) limits the Secretary's 
discretion only in prescribing standards, not sales prohibitions, and 
thus is inapplicable to the backstop requirement for GSLs in 42 U.S.C 
6295(i)(6)(A)(v).
---------------------------------------------------------------------------

    \18\ See 42 U.S.C. 6302(a)(5) for another example of a sales 
prohibition.
---------------------------------------------------------------------------

    With regard to comments on congressional intent underlying EISA, 
general service LEDs did not exist in any commercially viable sense in 
2007. It is therefore unlikely that Congress' intent in enacting EISA 
was to regulate incandescent lamps out of existence thirteen years in 
the future on the hope that such general service LEDs would be 
available. Moreover, the statutory text does not evidence such intent. 
In fact, the words of the statute suggest just the opposite. 
Specifically, in 42 U.S.C. 6295(i)(6)(B)(i)(I),\19\ Congress required 
that DOE undertake, not later than January 1, 2020, a second, similar 
rulemaking to decide whether to amend standards applicable to the same 
incandescent lamps at issue in this rulemaking. The fact that Congress 
directed DOE to undertake this rulemaking, which is to be initiated not 
later than the first day of 2020, suggests that Congress did not intend 
such lamps to be regulated out of existence beginning on that very same 
day. The existence of subparagraph (B) suggests that the Secretary was 
not limited in his discretion under subparagraph (A) to imposition of 
either the 45 lm/W backstop standard or a DOE-promulgated standard for 
GSLs that was more stringent than 45 lm/W. Congress was open to the 
possibility that something less than a 45 lm/W standard for GSLs could 
be adopted, as evidenced by the statute's direction to DOE in 42 U.S.C. 
6295(i)(6)(A)(ii)(II) to consider, but not require, a minimum standard 
of 45 lm/W for GSLs. Otherwise, subparagraph (B) would be mere

[[Page 71637]]

surplusage as there would be no GSILs to evaluate at the time mandated 
for the subparagraph (B) rulemaking. Thus, Congress did not require DOE 
to establish an energy conservation standard in this present rulemaking 
that would eliminate GSILs from the market.
---------------------------------------------------------------------------

    \19\ This provision provides that, not later than January 1, 
2020, the Secretary shall initiate a rulemaking procedure to 
determine whether standards in effect for general service 
incandescent lamps should be amended to reflect lumen ranges with 
more stringent maximum wattage than the standards specified in 
paragraph (1)(A).
---------------------------------------------------------------------------

C. Product Substitutes

    In the September 2019 GSIL NOPD, DOE preliminarily determined that 
any energy savings that might result from establishing a standard at 
the maximum technologically feasible level (referred to elsewhere in 
this document as ``TSL 1'', which denotes ``trial standard level 1'') 
are the result of product shifting as consumers abandon GSILs utilizing 
halogen infrared technology (``GSIL-HIR'') in favor of different 
product types having different performance characteristics or features. 
84 FR 46857. DOE noted that EPCA prohibits DOE from prescribing an 
amended or new standard if that standard is likely to result in the 
unavailability in the United States of any covered product type (or 
class) of performance characteristics (including reliability), 
features, sizes, capacities and volumes that are substantially the same 
as those generally available in the United States at the time of the 
Secretary's finding. 42 U.S.C. 6295(o)(4). Accordingly, DOE stated that 
it could not set a standard applicable to GSILs that results in 
consumers being left with no choice but an alternative lamp that is a 
different product type or has different performance characteristics or 
features than GSILs. 84 FR 46841. DOE concluded that it could not find 
economic justification in a standard the purpose of which is to force 
the unavailability of a product type, performance characteristic or 
feature in contravention of EPCA. Id. at 84 FR 46858.
    Comments from the State Attorneys General, Sierra Club and 
Earthjustice, CA IOUs, CEC, the Joint Advocates, NRDC and the IPI 
disagreed with DOE's application of the features provision in 42 U.S.C. 
6295(o)(4). (the State Attorneys General, No. 110 at p. 12; Sierra Club 
and Earthjustice, No. 104 at p. 10; CA IOUS, No. 83 at p. 2; CEC, No. 
102 at p. 3; the Joint Advocates, No. 113 at p. 3; NRDC, No. 97 at p. 
2; IPI, No. 96 at p. 4) In particular, the Sierra Club and Earthjustice 
stated that the text of the features provision, its legislative 
history, and other requirements in the statute make clear that for the 
features provision to block DOE from adopting a standard, not only must 
the standard result in the unavailability of the product performance 
characteristics, features, sizes, capacities, or volumes that are 
presently available, but the standard must leave the market with no 
alternative performance characteristics, features, sizes capacities, or 
volumes that are ``substantially the same'' as those that would be 
eliminated from the market. (the Sierra Club and Earthjustice, No. 104 
at p. 11.) Additionally, the State Attorneys General asserted that DOE 
has employed the features provision to preserve incandescent lighting, 
a legacy technology that offers consumers no distinct performance-
related utility. (the State Attorneys General, No. 110 at p. 12; see 
also CEC, No. 102 at p. 3). The State Attorneys General further stated 
that DOE's past refusal to treat lamp technology as a unique 
performance feature for product classification purposes highlights the 
arbitrary nature of DOE's September 2019 GSIL NOPD and its preferential 
treatment for incandescent lamp technology. Id. at 14. Further, CEC 
argued that DOE has neither made nor published any findings 
establishing by a preponderance of the evidence that GSILs provide 
performance characteristics that should be protected under 42 U.S.C. 
6295(o)(4); the mere existence of GSILs as a covered product is 
inadequate. (CEC, No. 102 at 3). CEC also noted that DOE acknowledged 
in the September 2019 GSIL NOPD that CFLs and LEDs can be used to 
satisfy lighting applications traditionally served by incandescent 
general service lamps. Id. at 4. Lastly, the Joint Advocates asserted 
that DOE cannot use the possibility that manufacturers may choose to no 
longer offer GSILs to justify the application of an unavailability 
scenario, or as an excuse to avoid full rulemaking analysis. These 
commenters stated that EPCA cannot reasonably be read to ensure the 
availability of a particular technology in perpetuity. (Joint 
Advocates, No. 113 at p. 3)
    Other commenters, including Free Market Organizations, GE, 
Westinghouse, and NEMA, supported DOE's conclusion in the September 
2019 GSIL NOPD that the elimination of the GSIL from the market by an 
amended standard is foreclosed by 42 U.S.C. 6295(o)(4). (See Free 
Market Organizations, No. 111 at p. 4; see also NEMA, No. 88 at p. 14) 
NEMA commented that the GSIL has a significant performance 
characteristic or feature for a significant group of consumers of this 
product that is not replicated by the CFL or general service LED (yet): 
The incandescent lamp's ability to deep-dim light output to below 0.1% 
of maximum output. NEMA stated that the CFL and LED cannot achieve the 
deep-dimming capability of the incandescent lamp. (NEMA, No. 88 at p. 
14) Further, NEMA stated that this performance and consumer utility are 
desirable to residential consumers for ambience effects in dining 
rooms, living rooms, bedrooms and other rooms of the home, as well as 
for safety in navigation in the middle of the night, and both are 
easily achieved with halogen technology. (Id. at 15.)
    DOE also received comments describing other features that are 
unique to incandescent lamps. An individual stated that compared with 
CFLs and LED lamps, the incandescent lamp requires much fewer raw 
materials and is basically just a wire and glass. The individual added 
that incandescent technology produces natural warm light, has a 100 
percent CRI, has a smooth spectrum with all colors, is omnidirectional, 
and is easy to use in control systems. The individual stated that the 
heat wasted by incandescent technology, typically 90-95 percent, can be 
used to provide warmth when useful (i.e., building codes recommend not 
using the technology in the summer or warmer climates). (Anonymous, No. 
98 at p. 10) Another individual stated that despite their higher 
operating costs and shorter lifetimes, incandescent lamps provide the 
highest CRI and ability to work on any type of dimmer or sensor, which 
is not true for other lighting technologies. (Gazoobie, No. 75 at p. 1)
    Compared to incandescent lamps, several individuals expressed 
safety concerns about CFLs and LED lamps. Specifically, one individual 
noted potentially undesirable features of CFLs include flicker, 
mercury, and electromagnetic wave radiation issues (e.g., UV light). 
Another individual noted that LED lamps contain chemicals. A separate 
individual commented that LED lamps or fixtures are not suitable for 
trouble lights--that is lights that are likely to break in the 
application they are used (e.g., construction sites). (Anonymous, No. 
27 at p. 1; Anonymous, No. 98 at p. 2; Anonymous, No. 98 at pp. 2, 25; 
Baker, No. 34 at p. 1)
    Several individuals stated that certain performance characteristics 
of LED lamps, primarily brightness, flicker, and emittance of blue 
light wavelengths can cause eye damage, loss of sleep, and headaches 
among other health issues.\20\

[[Page 71638]]

An individual commented that not all LED lamps flicker, but that the 
general public does not necessarily know how to choose an LED bulb that 
does not flicker; flicker may cause headaches and irritability. This 
individual stated that LED lamps do not have any flicker information on 
the package, as there is no easy way to measure flicker; modulation and 
rate are key in determining how flicker may affect a person. 
Additionally, the individual commented that the general public is 
unaware of the importance of reducing harsh blue light in the evenings. 
The individual added that per DOE documentation, LEDs may emit more 
blue light as they age, although this varies between lamps. The 
individual asserted that blue light emitted by LEDs has been linked to 
health issues such as disturbing circadian rhythms, muscular 
degeneration, and various cancers. The commenter added that only those 
with money and knowledge can install smarter LED lamps that can change 
color spectrum at different times of the day. (McAra, No. 33 at p. 1; 
Anonymous, No. 71 at p. 1; Anonymous, No. 98 at p. 2)
---------------------------------------------------------------------------

    \20\ To improve readability, the citation was moved to a 
footnote: (Baker, No. 30 at p. 1; Smith, No. 31 at p. 1; McAra, No. 
33 at p. 1; Baker, No. 34 at p. 1; Berry, No. 67 at p. 1; Anonymous, 
No. 68 at p. 1; Anonymous, No. 71 at p. 1; Brian, No. 72 at p. 1; 
Young, No. 99 at p. 1; Anonymous, No. 98 at p. 25; Anonymous, No. 98 
at p. 3; McAra, No. 33 at p. 1).
---------------------------------------------------------------------------

    42 U.S.C. 6295(o)(4) provides that the Secretary may not prescribe 
an amended or new standard under this section if the Secretary finds 
(and publishes such finding) that interested persons have established 
by a preponderance of the evidence that the standard is likely to 
result in the unavailability in the United States in any covered 
product type (or class) of performance characteristics (including 
reliability), features, sizes, capacities, and volumes that are 
substantially the same as those generally available in the United 
States at the time of the Secretary's finding. The language in this 
provision prohibits DOE from setting a standard that would result in 
the unavailability of the product performance characteristics, 
features, sizes, capacities, or volumes that are presently available in 
the market.
    Historically, DOE has determined whether a technology constitutes a 
performance characteristic (including reliability), feature, size, 
capacity, and volume (collectively referred to hereafter as 
``features'') under EPCA on a case-by-case basis. As highlighted by 
NEMA in its comments, the incandescent lamp's ability to deep-dim light 
output to below 0.1% of maximum light output represents a significant 
feature of this product that is not replicated by the CFL or general 
service LED lamp. This feature is desirable to residential consumers 
for ambience effects in dining rooms, living rooms, bedrooms and other 
rooms of the home, as well as for safety in navigation in the middle of 
the night. Setting a standard at TSL 1 would likely force the 
unavailability of deep-dimming general service lamps from the market. 
(See NEMA, No. 88 at p. 15) Moreover, aside from eliminating this 
significant feature to consumers, NEMA, with the support of GE and 
Westinghouse, has shown by a preponderance of the evidence that 
adopting a higher efficiency standard for GSILs would completely 
destroy the market for GSILs, a covered product, which is in violation 
of 42 U.S.C. 6295(o)(4). Earthjustice and NRDC argued in their March 1, 
2019 comments on a petition requesting an interpretive rule that DOE's 
proposed energy conservation standards for residential furnaces and 
commercial water heaters would result in the unavailability of 
performance characteristics within the meaning of 42 U.S.C. 6295(o)(4): 
``Congress did not intend the resulting unavailability of any and every 
performance characteristic to be a barrier to the imposition of strong 
efficiency standards. Rather, the legislative history of the provision 
confirms that the problem Congress intended section 325(o)(4) of EPCA 
to address is the possibility that efficiency standards could 
completely destroy the market for a covered product.'' (Earthjustice/
NRDC Joint Comment, No. 55 at p. 3). While we take no position (because 
we need not do so here) on the full scope of section 325(o)(4) of EPCA, 
we agree that section 325(o)(4) of EPCA is meant to preclude the 
imposition of efficiency standards that would completely destroy the 
market for a covered product. Thus, even if deep-dimming were not 
considered an important consumer feature under EPCA, DOE finds that 42 
U.S.C. 6295(o)(4) prevents standards for GSILs, as a distinct covered 
product listed under 42 U.S.C. 6292(a)(14), from being set at a level 
that would increase the price to the point that the product would be 
noncompetitive and that would result in the removal of the product from 
the market.

D. Economic Justification

    In the September 2019 GSIL NOPD, DOE tentatively concluded, based 
on the second EPCA factor concerning economic justification that DOE is 
required to evaluate in 42 U.S.C. 6295(o)(2)(B)(i)(II), that imposition 
of a standard at TSL 1, which as described in Section VII, represents 
the max-tech efficiency level for GSILs and is composed of modeled 
Halogen infrared lamps, is not economically justified because the 
operating costs of the covered product are insufficient to recover the 
upfront cost. 84 FR 46830, 46858. NEMA, GE, Westinghouse and the Free 
Market Organizations supported DOE's conclusion that more stringent 
standards for GSILs cannot be economically justified. (NEMA, No. 88 at 
p. 2; GE, No. 78 at p. 1; Westinghouse, No. 112 at p. 1; Free Market 
Organizations, No. 111 at p. 2). Westinghouse agreed with DOE that the 
cost of the more efficacious substitute modeled for GSILs would be 
prohibitive and represent a net loss to the consumer, and that, in the 
unlikely event any manufacturer chose to make it, very few consumers 
would be expected to purchase this product because they would lose 
money on every lamp. (Westinghouse, No. 112 at p. 1) GE stated that it 
is very unlikely that any lamp manufacturing business could 
economically justify an investment in manufacturing capacity for the 
modeled substitute product, which would contain Halogen-IR filament 
tubes. The GE factory that previously made Halogen-IR filament tubes 
has been closed and the production equipment no longer exists. (GE, No. 
78 at p. 2)
    Some commenters asserted that, in making this determination, DOE 
misapplied EPCA's requirements governing its analysis of economic 
justification, and that EPCA does not permit the Department to base its 
analysis of economic justification on the consideration of only one 
factor or to decline consideration of any of the statutory factors 
listed in 42 U.S.C. 6295(o)(2)(B)(i) based on the outcome of its 
analysis of any other factor. (the Sierra Club and Earthjustice, No. 
104 at p. 9) For example, the State Attorneys General and the IPI 
commented that DOE's failure to conduct an emissions analysis prior to 
issuing its proposed determination violates EPCA's requirement in 42 
U.S.C. 6295(o)(2)(B)(i)(VI) to evaluate the need for national energy 
and water conservation as part of its economic analysis. (the State 
Attorneys General, No. 110 at p. 15; IPI, No. 96 at pp. 3-4). The 
Sierra Club and Earthjustice commented that DOE failed to consider the 
fifth factor, which addresses impacts on competition; the sixth factor, 
which addresses the need for national energy and water conservation; 
and the seventh factor, which encompasses any other factors DOE 
considers relevant, such as the benefits that accrue when consumers 
switch from GSILs to other types of GSLs. (the Sierra Club and 
Earthjustice, No. 104 at pp. 9-10) The CA IOUs stated that DOE had 
failed to consider the total projected amount of energy, or as 
applicable, water savings

[[Page 71639]]

likely to result from the imposition of the standard as required by 42 
U.S.C. 6295(o)(2)(B)(i)(III). (CA IOUs, No. 83 at p. 3) The IPI further 
asserted that DOE seeks to import a new factor, unavailability, into 
the statutory definition of economically justified which Congress did 
not intend the agency to consider. (IPI, No. 96. at p. 1)
    When considering new or amended energy conservation standards, the 
standards that DOE adopts for any type (or class) of covered product 
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)) In determining 
whether a standard is economically justified, the Secretary must 
determine whether the benefits of the standard exceed its burdens by, 
to the greatest extent practicable, considering the seven statutory 
factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i)) The new or 
amended standard must also result in significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B)) DOE's analysis indicates that more 
stringent standards for modeled GSILs at TSL 1 would make the lamps 
prohibitively expensive to the consumer, aside from the fact that such 
a substitute would likely never even make it to market, given its past 
lack of commercial viability and manufacturer unwillingness to produce 
such an uneconomical product. Thus, amended energy conservation 
standards for GSILs would not be economically justified at any level 
above the current standard level, because the benefits of more 
stringent standards would not outweigh the burdens of a high upfront 
cost and long payback period for consumers.
    DOE continues to be of the view that failure to meet one aspect of 
the seven factors in EPCA's consideration of economic justification can 
mean that a revised standard is not economically justified, and that 
DOE can reach such a conclusion, in appropriate circumstances, without 
considering all of the other factors. For example, on October 17, 2016, 
DOE published in the Federal Register a final determination that more 
stringent energy conservation standards for direct heating equipment 
(DHE) would not be economically justified, and based this determination 
solely on manufacturer impacts, the first EPCA factor that DOE is 
required to evaluate in 42 U.S.C. 6295(o)(2)(B)(i)(I). 81 FR 71325. 
Specifically, due to the lack of advancement in the DHE industry in 
terms of product offerings, available technology options and associated 
costs, and declining shipment volumes, DOE concluded that amending the 
DHE energy conservation standards would impose a substantial burden on 
manufacturers of DHE, particularly small manufacturers. Id. at 81 FR 
71328. Notably, DOE received no stakeholder comments in opposition to 
its conclusions regarding economic justification in the DHE standards 
rulemaking.
    In this final rule, DOE remains consistent with its approach in the 
DHE rule, and finds no economic justification for amending standards 
based on DOE's consideration of one of the seven factors in 42 U.S.C. 
6295(o)(2)(B)(i), namely, that the energy savings in operating costs of 
the covered product are insufficient to recover the upfront cost.

E. Preemption

    The State Attorneys General asserted that the September 2019 GSIL 
NOPD mischaracterizes the scope of federal preemption under EPCA. (the 
State Attorneys General, No. 110 at p. 16) These commenters argued that 
EPCA does not delegate to DOE authority to decide whether a given state 
law is preempted, and that DOE is not entitled to deference for its 
interpretation of EPCA's preemption provision. (Id. at p. 17) The State 
Attorneys General rejected DOE's statement in the NOPD that because 
none of the narrow exceptions from preemption provided for in 42 U.S.C. 
6295(i)(6)(A)(vi) are available to California and Nevada, all states, 
including California and Nevada, are prohibited from adopting energy 
conservation standards for GSLs. See 84 FR 46832. On the contrary, the 
State Attorneys General commented that California and Nevada are 
entitled to exemption from preemption because DOE failed to fulfill the 
four required elements prescribed in 42 U.S.C. 6295(i)(6)(A)(i)-(iv), 
and therefore the exceptions to state preemption in clauses (vi)(II) 
and (vi)(III) have been triggered. (the State Attorneys General, No. 
110 at pp. 18-19) CEC similarly noted that it had implemented its own 
standards for GSLs, including GSILs under EPCA's preemption exception 
in 42 U.S.C. 6295(i)(6)(A)(vi)(II). (CEC, No. 102 at p. 1). 
Additionally, the State of Colorado stated that Colorado's greenhouse 
gas emission reduction goals and energy efficiency standards will 
continue to apply in the state regardless of whether DOE finalizes the 
proposed rule. (State of Colorado, No. 62 at p. 1).
    Federal energy conservation requirements generally supersede state 
laws or regulations concerning energy conservation standards. (42 
U.S.C. 6297(a)-(c)) Absent limited exceptions, states generally are 
precluded from adopting energy conservation standards for covered 
products both before and after an energy conservation standard becomes 
effective. (42 U.S.C. 6297(b) and (c)) However, the statute contains 
three narrow exceptions to this general preemption provision specific 
to GSLs in 42 U.S.C. 6295(i)(6)(A)(vi). Under the limited exceptions 
from preemption specific to GSLs that Congress included in EPCA, only 
California and Nevada have authority to adopt, with an effective date 
beginning January 1, 2018 or after, either:
    (1) A final rule adopted by the Secretary in accordance with 42 
U.S.C. 6295(i)(6)(A)(i)-(iv);
    (2) If a final rule has not been adopted in accordance with 42 
U.S.C. 6295(i)(6)(A)(i)-(iv), the backstop requirement under 42 U.S.C. 
6295(i)(6)(A)(v); or
    (3) In the case of California, if a final rule has not been adopted 
in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv), any California 
regulations related to ``these covered products'' adopted pursuant to 
state statute in effect as of the date of enactment of EISA 2007.
    DOE reiterates in this rule that none of these narrow exceptions 
from preemption are available to California or Nevada. The first 
exception applies if DOE determines that standards in effect for GSILs 
need to be amended and issues a final rule setting standards for these 
lamps in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv). In that 
event, California and Nevada would be allowed to adopt a rule identical 
to the Federal standards rule. This exception does not apply because 
DOE has determined that standards in effect for GSILs do not need to be 
amended and thus has not issued a final rule setting standards for 
these lamps in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv). The 
second exception allows California and Nevada to adopt the statutorily 
prescribed backstop of 45 lm/W if DOE determines standards in effect 
for GSILs need to be amended and fails to adopt a final rule for these 
lamps in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv). This 
exception does not apply because DOE has determined not to amend 
standards for GSILs, and thus no obligation exists for DOE to issue a 
final rule setting standards for these lamps in accordance with the 42 
U.S.C. 6295(i)(6)(A)(i)-(iv). The third exception does not apply 
because there were no California efficiency standards for GSLs in 
effect as of the date of enactment of EISA 2007. Therefore, all states, 
including California and Nevada, are prohibited from adopting energy 
conservation standards for GSLs, including GSILs.

[[Page 71640]]

F. Scope

    Some commenters argued that DOE did not analyze the proper scope of 
products. For example, the State Attorneys General submitted that DOE's 
delayed, segmented review of GSL and GSIL standards is inconsistent 
with the detailed, expeditious and logical rulemaking process Congress 
set forth in 42 U.S.C. 6295(i)(6)(A). (The State Attorneys General, No. 
110 at p. 16). Similarly, the CA IOUs maintained that DOE did not 
analyze the proper scope of products in the NOPD, and that DOE should 
have considered standards for the whole GSL product class, which 
includes fluorescent and LED technologies. (CA IOUs, No. 83 at p. 3) 
The CFA also took issue with DOE's approach in the September 2019 GSIL 
NOPD, commenting that, by ignoring superior technologies, like CFLs and 
especially LEDs, DOE runs afoul of the Administrative Procedure Act 
(APA) and violates executive branch guidance. (CFA, No. 76 at p. 20) 
Additionally, the Northwest Power and Conservation Council commented 
that to issue this NOPD that parses out and creates separate standards 
for lamps that are all GSLs by statute and that have the same function 
and intended use is contrary to the spirit of EPCA and potentially 
muddies the waters even further for the market to determine what 
technologies are subject to what standard in the coming year. 
(Northwest Power and Conservation Council, No. 58 at p. 2)
    The Appropriations Rider precluded DOE from gathering data, 
performing the analysis required under 42 U.S.C. 6295(i)(6)(A), and 
implementing standards with respect to the incandescent lamp standards 
at issue in this determination. Since the Appropriations Rider has been 
removed, DOE continues to perform its statutory duties under EPCA, 
which include determining whether standards for GSILs should be 
amended. As that determination is the predicate for the imposition of a 
deadline for issuance of a rule, DOE addresses that determination 
first, in the present rulemaking. DOE has determined not to amend 
standards for GSILs at this time, and thus the existing standards for 
GSILs found at DOE's regulations at 10 CFR 430.32(x) remain applicable 
and will continue to apply after January 1, 2020. DOE is still 
considering whether standards in effect for GSLs, namely LEDs and CFLs, 
should be amended.

G. NEPA

    In the September 2019 GSIL NOPD, DOE preliminarily concluded that 
the proposed rule fits within DOE's categorical exclusion A4 from the 
National Environmental Policy Act of 1969 (NEPA), which applies to 
actions that are interpretations or rulings with respect to existing 
regulations. 84 FR 46859; see also 10 CFR part 1021, subpart D, 
appendix A4. DOE received comments from the Sierra Club and 
Earthjustice disagreeing with DOE's proposed use of the A4 categorical 
exclusion. These commenters asserted that DOE's actions are not merely 
interpreting or ruling on an existing regulation, but, rather, that the 
September 2019 GSIL NOPD implements a statutory command to evaluate 
amendments to statutorily prescribed energy conservation standards. 
(Sierra Club and Earthjustice, No. 104 at p. 12) The Sierra Club and 
Earthjustice argued that DOE's proposal to cite categorical exclusion 
A4 avoids reviewing the environmental impacts of the proposed 
determination and suggests that DOE believes the same exclusion would 
be applicable whenever DOE refuses to amend an energy conservation 
standard. Id. The commenters stated that DOE could not finalize the 
September 2019 GSIL NOPD without completing a review of environmental 
impacts. Id.
    Similarly, the State Attorneys General argued that DOE had decided 
to apply, without any reasoning, categorical exclusion A4 to its 
proposed determination--rather than conduct an environmental impact 
statement (EIS) or environmental assessment (EA)--was arbitrary and 
capricious. (the State Attorneys General, No. 110 at pp. 22, 24) These 
commenters stated that they were unable to find any past instance in 
which DOE's Office of Energy Efficiency and Renewable Energy had relied 
on categorical exclusion A4 to support its determination not to 
undertake NEPA review for a proposed action. (Id. at p. 26) 
Additionally, the commenters asserted that DOE's statement in the 
September 2019 GSIL NOPD about completing its NEPA review before 
issuing the final action makes it unclear as to whether DOE is, in 
fact, carrying out a NEPA review. (Id. at p. 22)
    In this final determination, DOE concludes that amended energy 
conservation standards for GSILs would not be economically justified at 
any level above the current standard level. DOE disagrees with 
commenters that it did not use the appropriate categorical exclusion 
for the September 2019 GSIL NOPD. Categorical exclusion A4 accurately 
reflects the effect of this rulemaking, which is to maintain the status 
quo of an existing regulation by interpreting the existing standard. 
Because DOE is not adopting an amended energy conservation standard for 
GSILs, and thus is not changing the existing regulations, there are no 
significant environmental impacts to be evaluated under NEPA.
    Historically, DOE had prepared numerous EAs and findings of no 
significant impact (``FONSI'') for rulemakings that established energy 
conservation standards for consumer products and industrial 
equipment.\21\ In light of these experiences assessing the 
environmental effects of energy conservation standards, DOE proposed 
and finalized categorical exclusion B5.1 to specifically target energy 
conservation standard rulemakings as part of the changes made to its 
NEPA Implementing Procedures. 76 FR 214, 228; 76 FR 63764; see also 10 
CFR part 1021, subpart D, appendix B5.1. During that rulemaking 
process, DOE received neither negative comments nor objections to its 
proposal to adopt categorical exclusion B5.1 when the department's 
implementing procedures were finalized in October 2011. 76 FR 63764, 
63766. In practice, DOE's decades of conducting EAs and resulting FONSI 
determinations are relied upon whenever DOE utilizes categorical 
exclusion B5.1 as part of an energy conservation standard rulemaking. 
Therefore, DOE reasonably relies on categorical exclusion B5.1 to meet 
its NEPA obligations in situations where completing an energy 
conservation standard rulemaking would not otherwise impose a need to 
conduct an environmental assessment. While DOE has determined to not 
apply categorical exclusion B5.1 in this rulemaking, its decision 
nonetheless to not conduct an EA remains consistent with rulemakings 
that do amend energy conservation standards.
---------------------------------------------------------------------------

    \21\ See Technical Support Document for the National 
Environmental Policy Act Implementing Procedures, Final Rule, 
September 27, 2011, pp 46-48, for examples of prior EAs and FONSI 
determinations. https://www.energy.gov/nepa/downloads/technical-support-document-department-energys-notice-final-rulemaking.
---------------------------------------------------------------------------

    DOE's actions here find further support when viewed in the context 
of the DHE final rule. In the DHE final rule not to amend standards, 
DOE determined, with no stakeholder objections, that conducting an EA 
for its environmental review under NEPA was not required because 
updated standards were not being adopted. Arguably, DOE could make the 
same conclusion in this rulemaking, because amended standards for GSILs 
are similarly not being adopted.

[[Page 71641]]

H. Other Environmental Laws and Intergovernmental Consultation

    The State Attorneys General asserted that the September 2019 GSIL 
NOPD violates several environmental laws, including the Endangered 
Species Act, the Coastal Zone Management Act, and the National Historic 
Preservation Act. (State Attorneys General, No. 110 at pp. 26-27) In 
response to these concerns, DOE reiterates that this rulemaking 
determines not to amend energy conservation standards for GSILs, and, 
therefore, the existing standards applicable to GSILs remain in effect. 
Because this rulemaking maintains the status quo, there is no action 
that DOE is taking, and thus there are no environmental impacts to 
evaluate under the above listed statutes.
    Additionally, the State Attorneys General commented that DOE's 
failure to consult with state and local governments regarding the 
September 2019 GSIL NOPD violates Executive Order 13132, which sets 
forth certain requirements for Federal agencies formulating and 
implementing actions that preempt State law or that have Federalism 
implications. (Id. at pp. 27-28) As part of the notice and comment 
process set by the APA, DOE published the September 2019 GSIL NOPD in 
the Federal Register, providing interested parties, including state and 
local governments, notice of its initial decision not to amend energy 
conservation standards for GSILs. (84 FR 46858; 5 U.S.C. 553). In 
addition to publishing notice of the proposed determination, DOE held a 
public meeting on the September 2019 GSIL NOPD on Tuesday, October 15, 
2019. By following the statutory requirements of EPCA and the APA's 
rulemaking process, the same process DOE has followed for many years 
without objection by states, DOE provided ample opportunity for state 
and local governments to offer input and consult with DOE, via comments 
or otherwise, regarding DOE's initial determination not to amend the 
current energy conservation standard for GSILs.

VI. Methodology and Discussion of Related Comments

    This section addresses the analyses that DOE has performed for this 
final determination with regard to GSILs. Separate subsections address 
each component of DOE's analyses.
    DOE used several analytical tools to estimate the impact of the 
standards considered in this document. The first tool is a spreadsheet 
that calculates the LCC savings and PBP of potential amended energy 
conservation standards. The NIA uses a second spreadsheet that provides 
shipments projections and calculates NES and NPV of total consumer 
costs and savings expected to result from potential energy conservation 
standards. DOE uses a third spreadsheet, the Government Regulatory 
Impact Model (``GRIM''), to assess manufacturer impacts of potential 
amended standards. These three spreadsheets are available on the DOE 
website for this rulemaking (see Docket section at the beginning of 
this final determination).

A. Market and Technology Assessment

1. Scope of Coverage
    GSIL means a standard incandescent or halogen type lamp that is 
intended for general service applications; has a medium screw base; has 
a lumen range of not less than 310 lumens and not more than 2,600 
lumens or, in the case of a modified spectrum lamp, not less than 232 
lumens and not more than 1,950 lumens; and is capable of being operated 
at a voltage range at least partially within 110 and 130 volts; however 
this definition does not apply to the following incandescent lamps: (1) 
An appliance lamp; (2) A black light lamp; (3) A bug lamp; (4) A 
colored lamp; (5) An infrared lamp; (6) A left-hand thread lamp; (7) A 
marine lamp; (8) A marine signal service lamp; (9) A mine service lamp; 
(10) A plant light lamp; (11) A reflector lamp; (12) A rough service 
lamp; (13) A shatter-resistant lamp (including a shatter-proof lamp and 
a shatter-protected lamp); (14) A sign service lamp; (15) A silver bowl 
lamp; (16) A showcase lamp; (17) A 3-way incandescent lamp; (18) A 
traffic signal lamp; (19) A vibration service lamp; (20) A G shape lamp 
with a diameter of 5 inches or more; (21) A T shape lamp that uses not 
more than 40 watts or has a length of more than 10 inches; and (22) A 
B, BA, CA, F, G16-1/2, G-25, G30, S, or M-14 lamp of 40 watts or less. 
10 CFR 430.2 In this analysis, DOE relied on the definition of 
``general service incandescent lamp'' currently in 10 CFR 430.2.
    As discussed in section II.A, DOE continued to analyze GSILs as the 
covered product in this final determination. DOE did consider the 
possibility that consumers may choose out-of-scope substitutes, such as 
CFLs and LED lamps, if standards for GSILs were amended. See section 
VI.B.6 for a more detailed discussion of those lamps.
2. Metric
    Current energy conservation standards for GSILs are applicable to 
active mode energy use and are based on a maximum wattage for a given 
lumen range. In this final rule, DOE used efficacy (lumens divided by 
watts, or lm/W) to assess active mode energy use. The measurement of 
lumens and watts and the calculation of lamp efficacy for GSILs is 
included in the current test procedure at appendix R to subpart B of 10 
CFR part 430.
3. Technology Options
    To develop a list of technology options, DOE reviewed manufacturer 
catalogs, recent trade publications, technical journals, and the 2015 
IRL final rule \22\ for incandescent reflector lamps, and consulted 
with technical experts. Based on DOE's review of product offerings and 
their efficacies in manufacturer catalogs and DOE's Compliance 
Certification Management System (CCMS) database, GSILs are not 
commercially available at efficacy levels above that which is currently 
required. However, DOE identified fourteen technology options in the 
September 2019 GSIL NOPD that could be used to improve the efficiency 
of currently commercially available GSILs.
---------------------------------------------------------------------------

    \22\ Documents from DOE's rulemaking for IRLs are available 
here: https://www.regulations.gov/docket?D=EERE-2011-BT-STD-0006.
---------------------------------------------------------------------------

    Westinghouse noted that commercially available GSILs already 
include many of the technology options identified where they are cost 
effective and can be used in a manner that meets necessary product 
performance and important safety considerations. (Westinghouse, No. 112 
at p. 1) Because GSILs are already operating close to their optimum 
level, NEMA stated that the technology options not screened out will 
not provide a significant increase in lamp efficacy. (NEMA, No. 88 at 
p. 6; Westinghouse, No. 112 at p. 1) While improvements in efficacy 
from any single technology option may be minor, DOE concludes in this 
final determination that all technology options identified in the 
September 2019 GSIL NOPD could potentially increase the efficacy of 
GSILs.
    DOE also received comments on specific technology options. 
Regarding higher pressure operation, NEMA stated that halogen lamps are 
at the practical limit of higher pressure operation without risking 
safety. (NEMA, No. 88 at pp. 6) DOE considers alterations to the lamp 
that might be necessary for safety reasons if the lamp operates at a 
higher pressure. See VI.B.3 for more detail.
    Regarding higher efficiency inert fill gas, NEMA stated that 
halogen lamps are already using xenon and krypton to reduce heat 
conduction. Consequently,

[[Page 71642]]

NEMA commented that improving lamp efficacy via alternative fill gasses 
is not a viable option. (NEMA, No. 88 at pp. 6) NEMA submitted a 
similar comment during the 2015 IRL rulemaking and DOE noted that while 
the majority of standards-compliant IRLs utilize xenon, the amount of 
xenon used in a lamp can vary. DOE concluded in that rulemaking that 
xenon could be used to improve lamp efficacy and DOE reaches the same 
conclusion in this final determination. 80 FR 4042, 4059 (January 26, 
2015).
    NEMA stated that certain technology options require redesigning the 
current halogen incandescent lamp, adding to their cost. NEMA 
elaborated with the following examples: (1) Use of higher pressure 
requires adding a heavy glass outer jacket to contain a potential 
rupture of the filament tube caused by the increased pressure and (2) 
thinner filaments require tighter coil spacing to maintain the efficacy 
and avoid hot shock issues leading to early lamp failure. Additionally, 
NEMA explained that for the higher efficiency burner design option, 
using a double-ended burner in itself is not more efficient, rather it 
reduces costs by allowing for a smaller capsule design. (NEMA, No. 88 
at pp. 6-7) DOE considers technology options regardless of their cost. 
DOE considers cost impacts in determining the economic justification of 
any standard levels developed using the technology options identified. 
See VI.B.3 for more detail regarding lamp alterations necessary to 
eliminate safety concerns.
    Additionally, NEMA stated that higher temperature improves efficacy 
but shortens lifetime and would only make sense for a lamp with 
lifetime lower than 1,000 hours. NEMA added the same would apply to use 
of thinner filaments which require higher temperature operation. (NEMA, 
No. 88 at pp. 6) DOE understands that for certain technologies there 
may be a tradeoff between efficacy and lifetime. DOE does not consider 
efficacy levels that necessitate a reduction in lamp lifetime relative 
to the baseline.
    In the September 2019 GSIL NOPD DOE stated that the infrared (IR) 
glass coating technology option involves coatings that reflect some 
radiant energy emitted back onto the filament, which supplies heat to 
the filament increasing its temperature and thereby increasing lamp 
efficacy. 84 FR 46830, 46836 (September 5, 2019). NEMA clarified the 
increase in efficacy from IR glass coatings is due to the lamp reusing 
the radiant energy emitted back on to the filament resulting in less 
power needed to heat the filament. NEMA added that just increasing the 
temperature of the filament would shorten the lamp lifetime. (NEMA, No. 
88 at p. 7) DOE agrees that reduction of power is also a component in 
this technology option. In chapter 3 of the NOPD TSD, DOE noted that in 
addition to the increase in temperature leading to an increase light 
output, the reflected IR radiation from IR glass coatings can also 
decrease the amount of energy needed to heat the filament.
    DOE also received comments regarding two technology options that 
were not identified in the September 2019 GSIL NOPD that should be 
considered by DOE in this final determination. The Joint Advocates 
noted that DOE did not consider the technology used in the Philips 
EcoClassic HIR lamp operated at 230 volts (``V'') that was introduced 
in Europe. The Joint Advocates explained that the lamp used an internal 
power supply to drive the halogen capsule at 12 volts allowing Philips 
to use a sturdy, compact filament and achieve 50 percent energy savings 
over the conventional halogen bulb. (Joint Advocates, No. 113 at pp. 4-
5, 7)
    DOE has considered the use of an integral ballast (or a 
transformer) in an incandescent lamp that steps down the line voltage 
to a lower voltage (i.e., integrally ballasted low voltage) in previous 
IRL rulemakings. In the 2009 IRL rulemaking \23\ DOE identified this as 
a technology option and was aware that an integrally ballasted low 
voltage lamp was offered in Europe. 73 FR 13620, 13644 (March 13, 
2008). In that rulemaking, CA IOUs provided test data showing 
prototypes of integrally ballasted low voltage IRLs operating at 120 V 
that could reach higher efficacies than the baseline. However, because 
the prototype that could reach the max-tech level also used a 
developmental design option (i.e., silverized reflectors), DOE 
determined that the actual achievable efficacy when manufactured at a 
large scale was unclear. Additionally, Philips commented that higher 
mains voltages found in Europe (such as 220 V and 240 V) 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 120 V is used. Therefore, in the 
2009 IRL rulemaking, DOE recognized integrally ballasted low voltage 
lamps as a design option but did not base max-tech or adopt any TSL on 
the test data provided for the design option. 74 FR 34080, 34135 (July 
14, 2009). In the 2015 IRL rulemaking, DOE removed integrally ballasted 
low voltage lamps as a technology option after receiving feedback that 
lamps using the technology are limited to certain wattages due to heat 
dissipation issues caused by the electronic components. Specifically, 
NEMA cited a 30 W limit and manufacturers in interviews cited a 
limiting range of 20 to 35 W. 80 FR 4060 (January 26, 2015). Based on 
the lack of definitive data on achievable efficacy and potential 
technological issues with wattages necessary to provide a lumen output 
within the range stated by the GSIL definition, DOE is not considering 
integrally ballasted low voltage lamps as a technology option in this 
analysis.
---------------------------------------------------------------------------

    \23\ Documents from DOE's rulemaking for IRLs are available 
here: https://www.regulations.gov/docket?D=EERE-2006-STD-0131.
---------------------------------------------------------------------------

    The Joint Advocates also stated DOE did not include photonic 
crystals as infrared reflectors used in a proof-of-concept high-
efficiency bulb presented by researchers from the Massachusetts 
Institute of Technology (MIT).\24\ (Joint Advocates, No. 113 at pp. 4-
5, 7) DOE reviewed the MIT research cited by commentators and 
determined it presents a technology option for improving GSIL efficacy 
not identified in the September 2019 GSIL NOPD. The technology option 
uses a photonic filter designed to ensure IR radiation is completely 
reflected back to the filament while visible light is emitted out. The 
filter can be a 1- to 3-dimensional photonic crystal that surrounds the 
filament.25 26 In this final determination DOE identifies 
photonic filters as a technology option for increasing GSIL efficacy.
---------------------------------------------------------------------------

    \24\ Ognjen, Ilic et al. ``Tailoring high-temperature radiation 
and the resurrection of the incandescent source'' Nature 
Nanotechnology 11, 320-324 (2016).
    \25\ Bermel, et al. (2014) U.S. Patent No. 8,823,250 B2. 
Washington, DC: U.S. Patent and Trademark Office.
    \26\ Ognjen, Ilic et al. ``Tailoring high-temperature radiation 
and the resurrection of the incandescent source'' Nature 
Nanotechnology 11, 320-324 (2016).
---------------------------------------------------------------------------

    In this final determination, DOE has identified 15 technology 
options (see Table VI.1) to improve the efficacy of GSILs, as measured 
by the DOE test procedure. See section VI.A.4 for a discussion of which 
technology options were screened out of the analysis, see section 
VI.B.3 for a more complete discussion of how the remaining technology 
options (called design options) were incorporated into the more 
efficacious HIR lamps modeled in the engineering analysis, and see 
section

[[Page 71643]]

VI.C for a discussion of how lamp prices were determined.

                   Table VI.1--GSIL Technology Options
------------------------------------------------------------------------
  Name of technology option                   Description
------------------------------------------------------------------------
Higher Temperature Operation.  Operating the filament at higher
                                temperatures, the spectral output shifts
                                to lower wavelengths, increasing its
                                overlap with the eye sensitivity curve.
Microcavity Filaments........  Texturing, surface perforations,
                                microcavity holes with material
                                fillings, increasing surface area and
                                thereby light output.
Novel Filament Materials.....  More efficient filament alloys that have
                                a high melting point, low vapor
                                pressure, high strength, high ductility,
                                or good radiating characteristics.
Thinner Filaments............  Thinner filaments to increase operating
                                temperature. This measure may shorten
                                the operating life of the lamp.
Crystallite Filament Coatings  Layers of micron or submicron
                                crystallites deposited on the filament
                                surface that increases emissivity of the
                                filament.
Higher Efficiency Inert Fill   Filling lamps with alternative gases,
 Gas.                           such as Krypton, to reduce heat
                                conduction.
Higher Pressure Tungsten-      Increased halogen bulb burner
 Halogen Lamps.                 pressurization, allowing higher
                                temperature operation.
Non-Tungsten-Halogen           Novel filament materials that regenerate.
 Regenerative Cycles.
Infrared Glass Coatings......  When used with a halogen burner, this is
                                referred to as an HIR lamp. Infrared
                                coatings on the inside of the bulb to
                                reflect some of the radiant energy back
                                onto the filament.
Infrared Phosphor Glass        Phosphor coatings that can absorb
 Coatings.                      infrared radiation and re-emit it at
                                shorter wavelengths (visible region of
                                light), increasing the lumen output.
Ultraviolet Phosphor Glass     Phosphor coatings that convert
 Coatings.                      ultraviolet radiation into longer
                                wavelengths (visible region of light),
                                increasing the lumen output.
High Reflectance Filament      Filament supports that include a
 Supports.                      reflective face that reflects light to
                                another filament, the reflective face of
                                another filament support, or radially
                                outward.
Permanent Infrared Reflector   Permanent shroud with an IR reflector
 Coating Shroud.                coating and a removable and replaceable
                                lamp can increase efficiency while
                                reducing manufacturing costs by allowing
                                IR reflector coatings to be reused.
Higher Efficiency Burners....  A double-ended burner that features a
                                lead wire outside of the burner, where
                                it does not interfere with the
                                reflectance of energy from the burner
                                wall back to the burner filament in HIR
                                lamps.
Photonic Filter..............  A photonic filter surrounding the
                                filament designed to ensure IR radiation
                                is reflected back to the emitter while
                                visible light is emitted out.
------------------------------------------------------------------------

4. Screening Analysis
    DOE uses the following four screening criteria to determine which 
technology options are suitable for further consideration in an energy 
conservation standards rulemaking:
    (1) Technological feasibility. Technologies that are not 
incorporated in commercial products or in working prototypes will not 
be considered further.
    (2) Practicability to manufacture, install, and service. If it is 
determined that mass production and reliable installation and servicing 
of a technology in commercial products could not be achieved on the 
scale necessary to serve the relevant market at the time of the 
projected compliance date of the standard, then that technology will 
not be considered further.
    (3) Impacts on product utility or product availability. If it is 
determined that a technology would have significant adverse impact on 
the utility of the product to significant subgroups of consumers or 
would result in the unavailability of any covered product type with 
performance characteristics (including reliability), features, sizes, 
capacities, and volumes that are substantially the same as products 
generally available in the United States at the time, it will not be 
considered further.
    (4) Adverse impacts on health or safety. If it is determined that a 
technology would have significant adverse impacts on health or safety, 
it will not be considered further.

10 CFR part 430, subpart C, appendix A, 4(a)(4) and 5(b)
    In summary, if DOE determines that a technology, or a combination 
of technologies, fails to meet one or more of the listed four criteria, 
it will be excluded from further consideration in the engineering 
analysis. Additionally, it is DOE policy not to include in its analysis 
any proprietary technology that is a unique pathway to achieving a 
certain efficacy level.
    In the September 2019 GSIL NOPD, DOE screened out eight technology 
options because DOE could not find evidence of their existence in 
working prototypes or commercially available products, they were not 
practicable to manufacture, and/or they impacted product utility. NEMA 
agreed with the technology options that DOE screened out for the 
reasons set forth in the September 2019 GSIL NOPD. (NEMA, No. 88 at p. 
6) DOE received no other adverse comments regarding the screening 
analysis. Therefore, the technology options that were screened out in 
the September 2019 GSIL NOPD are also screened out in this final 
determination.
    As described in VI.A.3, in this final determination DOE added 
photonic filters as a technology option; photonic filters around 
filaments reflect IR radiation back to the filament while allowing 
visible light to exit. However, filter and filament stability, 
evaporation of filament material, and optimization of the spacing 
between the filter and filament have been cited as potential challenges 
in the development of this technology.\27\ Further, DOE's review of the 
paper cited by the Joint Advocates and the patent for the technology 
does not indicate that a complete lamp was assembled with the photonic 
filter included and DOE believes including photonic filters would 
require use of manufacturing techniques not currently used in the mass 
production of GSILs. Therefore, DOE screens out this technology option 
based on the first criterion, technological feasibility, and

[[Page 71644]]

the second criterion, practicability to manufacture.
---------------------------------------------------------------------------

    \27\ Arny Leroy, Bikram Bhatia, Kyle Wilke, Ognjen Ilic, Marin 
Solja[ccaron]i[cacute], et al. ``High performance incandescent 
lighting using a selective emitter and nanophotonic filters,'' 
Proceedings from SPIE Optical Engineering + Applications, 2017.
---------------------------------------------------------------------------

    The technology options screened out of this analysis are summarized 
in Table VI.2 of this document.

    Table VI.2--GSIL Technology Options Screened Out of the Analysis
------------------------------------------------------------------------
    Design option excluded                 Screening criteria
------------------------------------------------------------------------
Novel Filament Materials.....  Technological feasibility, Practicability
                                to manufacture, install, and service,
                                Adverse impact on product utility.
Microcavity Filaments........  Technological feasibility, Practicability
                                to manufacture, install, and service,
                                Adverse impact on product utility.
Crystallite Filament Coatings  Technological feasibility, Practicability
                                to manufacture, install, and service.
High Reflectance Filament      Technological feasibility, Practicability
 Supports.                      to manufacture, install, and service.
Non-Tungsten-Halogen           Technological feasibility, Practicability
 Regenerative Cycles.           to manufacture, install, and service,
                                Adverse impact on product utility.
Permanent Infrared Reflector   Technological feasibility, Practicability
 Coating Shroud.                to manufacture, install, and service.
Infrared Phosphor Glass        Technological feasibility, Practicability
 Coating.                       to manufacture, install, and service.
Ultraviolet Phosphor Glass     Technological feasibility, Practicability
 Coating.                       to manufacture, install, and service.
Photonic Filters.............  Technological feasibility, Practicability
                                to manufacture, install, and service.
------------------------------------------------------------------------

    DOE concludes that all of the other identified technologies listed 
in Table VI.1 met all four screening criteria to be examined further as 
design options in DOE's final determination. In summary, DOE did not 
screen out the following technology options:

 Higher Temperature Operation
 Thinner Filaments
 Higher Efficiency Inert Fill Gas
 Higher Pressure Tungsten-Halogen Lamps
 Infrared Glass Coatings
 Higher Efficiency Burners
5. Product Classes
    When evaluating and establishing energy conservation standards, DOE 
divides the covered product into classes by (1) the type of energy 
used, (2) the capacity of the product, or (3) any other performance-
related feature that affects energy efficiency and justifies different 
standard levels, considering factors such as consumer utility. (42 
U.S.C. 6295(q)) Product classes for GSILs are currently divided based 
on lamp spectrum and lumen output. In the September 2019 GSIL NOPD, DOE 
proposed to maintain separate product classes based on lamp spectrum 
but did not propose to maintain separate product classes based on lumen 
output.
    CA IOUs stated that modified spectrum lamps do not need to be in a 
separate product class and efficacy allowances in current regulations 
for these products are too large. (CA IOUs, No. 83 at p. 3)
    As described in section VI.A.1, DOE considers GSILs to be the 
covered product in this final determination and therefore DOE considers 
only GSILs when establishing product classes. The CA IOUs did not 
provide any rationale for why modified spectrum GSILs should be in the 
same product class as standard spectrum GSILs. Modified spectrum \28\ 
lamps provide unique utility to consumers by providing a different type 
of light than standard spectrum lamps, much like fluorescent and LED 
lamps with different correlated color temperature (``CCT'') values. 
However, the same technologies that modify the spectral emission of a 
lamp also decrease lamp efficacy. To modify the spectrum, the coating 
absorbs a portion of the light emission from the filament. Neodymium 
coatings or other coatings on modified spectrum lamps absorb some of 
the visible emission from the incandescent filament (usually red), 
creating a modified, reduced spectral emission. Since the neodymium or 
other coatings absorb some of the lumen output from the filament, these 
coatings decrease the efficacy of the lamp. Because of the impact on 
both efficacy and utility, DOE is maintaining separate product classes 
based on spectrum.
---------------------------------------------------------------------------

    \28\ Definition of ``Modified spectrum'' is set out at 10 CFR 
430.2.
---------------------------------------------------------------------------

    In summary, DOE evaluates two product classes for GSILs--one for 
GSILs that meet the definition of modified spectrum in 10 CFR 430.2 and 
one for standard spectrum GSILs (i.e. do not meet the definition of 
modified spectrum). See chapter 3 of the final determination TSD for 
further discussion.

B. Engineering Analysis

    In the engineering analysis, DOE selects representative product 
classes to analyze. It then selects baseline lamps within those 
representative product classes and identifies more-efficacious 
substitutes for the baseline lamps. DOE uses these more-efficacious 
lamps to develop efficacy levels.
    For this rulemaking, DOE selected more efficacious substitutes in 
the engineering analysis and determined the consumer prices of those 
substitutes in the product price determination. DOE estimated the 
consumer price of lamps directly because reverse-engineering is 
impractical since the lamps are not easily disassembled. By combining 
the results of the engineering analysis and the product price 
determination, DOE derived typical inputs for use in the LCC analysis 
and NIA. Section VI.C discusses the product price determination.
    The methodology for the engineering analysis consists of the 
following steps: (1) Select representative product classes, (2) select 
baseline lamps, (3) identify more efficacious substitutes, (4) develop 
efficacy levels by directly analyzing representative product classes, 
and (5) scale efficacy levels to non-representative product classes. 
The details of the engineering analysis are discussed in further detail 
in chapter 5 of the final determination TSD.
1. Representative Product Classes
    In the case where a covered product has multiple product classes, 
DOE identifies and selects certain product classes as 
``representative'' and concentrates its analytical effort on those 
classes. DOE chooses product classes as representative primarily 
because of their high market volumes. Based on its assessment of 
product offerings, in the September 2019 GSIL NOPD DOE analyzed 
standard spectrum GSILs as representative (only 3 percent of 
commercially available halogen GSILs were marketed as having a modified 
spectrum). This is consistent with the 2015 IRL rulemaking in which DOE 
analyzed, with support from NEMA, standard spectrum IRLs as 
representative. 79 FR 24068, 24107 (April 29, 2014).

[[Page 71645]]

    NRDC requested DOE provide market shares or sales data for modified 
spectrum incandescent lamps. NRDC stated that major retailers have 
switched their house-branded lamps to be modified spectrum lamps. NRDC 
added that modified spectrum incandescent or halogen lamps provide 
little to no energy savings and less light compared to the old 
incandescent lamps. (NRDC, Public Meeting Transcript, No. 56 at pp. 39, 
42) GE disagreed with NRDC noting that GE's halogen Reveal lamps are 
sold at the same wattages (i.e., 43 W, 53 W) as the comparable halogen 
lamp on the market and have the same effect.\29\ (GE, Public Meeting 
Transcript, No. 56 at pp. 42-43)
---------------------------------------------------------------------------

    \29\ DOE interprets ``have the same effect'' as meaning they are 
perceived as providing the same amount of light.
---------------------------------------------------------------------------

    Westinghouse stated that using the number of models as a proxy for 
market data is not an effective approach. However, Westinghouse stated 
that anecdotally it could confirm the volume of modified spectrum lamps 
is lower than standard spectrum. (Westinghouse, Public Meeting 
Transcript, No. 56 at pp. 39-40) GE also confirmed that standard 
spectrum products outsell modified spectrum products by a significant 
percentage. (GE, Public Meeting Transcript, No. 56 at p. 43)
    DOE consulted available market reports, such as the 2015 U.S. 
Lighting Market Characterization,\30\ searched for shipment information 
regarding modified spectrum incandescent lamps, and reviewed market 
reports for LED lamps, such as those available from DOE's Solid-State 
Lighting Program, to get a better sense of the popularity of modified 
spectrum lamps as compared to standard spectrum lamps. There is very 
little public information available. As noted by GE during the public 
meeting, NEMA does not track shipments of modified spectrum lamps. (GE, 
Public Meeting Transcript, No. 56 at p. 41) Available information 
includes product offerings (with lamps designated as modified or 
standard spectrum), industry support in past DOE rulemakings for IRLs 
that standard spectrum lamps are much higher volume than modified 
spectrum lamps, and manufacturer confirmation at the October 2019 
public meeting that standard spectrum GSILs have higher shipments than 
modified spectrum GSILs. Given the available information, DOE continues 
to analyze standard spectrum GSILs as representative in the final 
determination.
---------------------------------------------------------------------------

    \30\ Available at https://www.energy.gov/sites/prod/files/2017/12/f46/lmc2015_nov17.pdf.
---------------------------------------------------------------------------

2. Baseline Lamps
    For each representative product class, DOE selects a baseline lamp 
as a reference point against which to measure changes resulting from 
energy conservation standards. Typically the baseline lamp is the most 
common, least efficacious lamp that meets existing energy conservation 
standards. In the September 2019 GSIL NOPD, DOE selected as a baseline 
the least efficacious lamp meeting standards with the most common lumen 
output and, where possible, with the most common wattage, lifetime, 
input voltage, and shape for the product class.
    Sierra Club and Earthjustice stated that DOE had not analyzed the 
correct baseline lamp because the backstop standard has been triggered 
and all GSLs sold beginning January 1, 2020 will need to meet a 45 
lumens per watt standard. (Sierra Club and Earthjustice, No. 104 at p. 
7) As stated in section V.A, the backstop has not yet been triggered 
and therefore DOE did not consider a minimum standard of 45 lumens per 
watt when selecting a baseline lamp.
    GE confirmed that the lumen output of the traditional 60-watt 
incandescent lamp, selected by DOE, is the most popular lumen output on 
the market. (GE, No. 78 at p. 2) DOE received no other comments 
regarding the baseline lamp selected in the September 2019 GSIL NOPD 
and therefore selects the same baseline lamp for this final 
determination (shown in Table VI.3). See chapter 5 of the final 
determination TSD for more detail.

                                                                Table VI.3--Baseline GSIL
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                        Rated  lifetime   Efficacy  (lm/
                  EL                             Technology              Wattage         Bulb shape    Initial  lumens        (hrs)             W)
--------------------------------------------------------------------------------------------------------------------------------------------------------
EL 0/Baseline.........................  Halogen....................              43              A19              750            1,000             17.4
--------------------------------------------------------------------------------------------------------------------------------------------------------

3. More Efficacious Substitutes
    In the September 2019 GSIL NOPD, DOE evaluated more-efficacious 
lamps as replacements for the baseline lamp by considering commercially 
available products and technologies not eliminated in the screening 
analysis. DOE could not use data in the compliance certification 
database to evaluate more efficacious lamps because the information 
required to calculate efficacy was not included; rated wattage was 
reported for a given lumen range rather than for an exact lumen output. 
Instead, DOE reviewed its database of commercially available GSILs for 
lamps that met the definition of a GSIL, had a lumen output between 750 
and 1,049 lumens, had an A-shape, and had a higher efficacy than the 
baseline lamp while still exceeding the minimum standard established by 
EISA. DOE did not identify any commercially available GSILs that could 
serve as more efficacious substitutes for the baseline lamp.
    Because no commercially available products could serve as a more 
efficacious substitute, DOE modeled a more efficacious substitute for 
the baseline lamp in the September 2019 GSIL NOPD. The modeled lamp was 
based on an actual lamp that previously had been commercially available 
but was taken off the market for economic reasons. GE previously 
offered for sale GSILs that used HIR technology; GE's 60 watt 
equivalent GSIL that employed IR coatings had a rated wattage of 45 
watts and a lifetime of 3,000 hours. DOE reviewed information on 
discontinued products and found a label that indicated this product had 
a lumen output of 870 lumens. DOE used a similar methodology as in the 
2009 IRL rulemaking \31\ and the 2015 IRL rulemaking \32\ to adjust the 
lumen output and lifetime of the lamp to be equal to that of the 
baseline lamp (see chapter 5 of the TSD for the 2009 IRL final rule). 
Making these adjustments lowered the rated wattage of the modeled lamp 
to 34.3 watts.
---------------------------------------------------------------------------

    \31\ DOE published a final rule on July 14, 2009 amending energy 
conservation standards for IRLs. The docket for the 2009 rulemaking 
is available at https://www.regulations.gov/docket?D=EERE-2006-STD-0131.
    \32\ Chapter 5 of the TSD for the 2015 IRL final rule is 
available at https://www.regulations.gov/document?D=EERE-2011-BT-STD-0006-0066.
---------------------------------------------------------------------------

    DOE received several comments regarding the characteristics of the 
HIR lamp modeled in the engineering analysis. NRDC stated that DOE 
failed to

[[Page 71646]]

provide the method used to determine the performance characteristics of 
the modeled lamp and information on the actual lamp sold by GE in their 
analysis. (NRDC, No. 97 at p. 4) In September 2019 GSIL NOPD, DOE 
stated that it modeled the more efficacious substitute at EL 1 using a 
previously offered GE lamp with a rated wattage 45 watts, a lifetime of 
3,000 hours, and a lumen output of 870 lumens. DOE explained that it 
used the same methodology used in the previous IRL rulemakings (both 
the 2009 IRL Rulemaking and the 2015 IRL Rulemaking) to adjust the 
lumen output and lifetime of the lamp. 84 FR 46830, 46840. DOE 
specified the equation used to make these adjustments in chapter 5 of 
the NOPD TSD. DOE developed this equation and its associated constants 
in the 2009 IRL rulemaking using a set of equations from the IESNA 
Handbook that relate voltage to lumens, wattage, and lifetime. (See 
chapter 5 of 2009 IRL final rule TSD and 2015 IRL final rule TSD.) DOE 
determined that the equation used in the IRL rulemakings could be 
applied GSILs because they use the same technology to produce light. 
DOE continues to use the equation described in this paragraph to model 
lamps in this final determination.
    DOE received comments confirming the performance characteristics of 
the HIR lamp modeled at EL 1. GE stated that DOE had modeled the 
representative unit at EL 1 based on a technically sound lamp that was 
offered by GE for a few years. GE confirmed that if the lumen output of 
the lamp it offered (870 lumens) was lowered to 750 lumens and the 
lifetime of the lamp it offered (3,000 hours) was lowered to 1,000 
hours, the wattage of the lamp would be similar or the same as the 
wattage of the HIR lamp modeled by DOE. (GE, Public Meeting Transcript, 
No. 56 at pp. 49-50) GE stated that it no longer sells HIR technology 
in its A-line lamps because it cannot economically compete with current 
lighting options. (GE, Public Meeting Transcript, No. 56 at p. 53; GE, 
No. 78 at p. 2)
    DOE also received comments regarding the design options 
incorporated into the modeled lamp. In the September 2019 GSIL NOPD, 
DOE stated that the modeled lamp utilized an IR coating and also higher 
temperature and pressure operation. DOE stated that the modeled lamp 
did not incorporate thinner filaments, higher efficiency inert fill 
gas, or higher efficiency burners because DOE did not believe including 
those design options would increase the efficacy beyond that achieved 
by the combination of an IR coating and higher temperature and pressure 
operation.
    NEMA agreed with DOE's initial determination that an HIR lamp is 
the only technologically feasible GSIL alternative that is more 
efficacious than the halogen lamp currently on the market. (NEMA, No. 
88 at p. 5) GE stated that while different advanced filament 
technologies were evaluated in the past 20 years, only HIR technology 
identified by DOE has proven technologically feasible to manufacture 
for commercial sale and therefore, represents the best design option 
for this analysis. (GE, No. 78 at p. 2) Rothenhaus similarly stated 
that HIR technology is the most efficient form of GSIL. (Rothenhaus, 
No. 16 at p. 2)
    IPI disagreed with DOE's decision to not incorporate thinner 
filaments, higher efficiency inert fill gas, and higher efficiency 
burner design options in the modeled lamp. IPI stated that in doing so, 
DOE did not consider that technological development due to regulatory 
pressure may reduce the cost or increase the efficacy of these 
additional technology options, making higher efficiency GSILs 
available. (IPI, No. 96 at p. 5) The Joint Advocates noted that DOE 
identified other, valid energy efficiency technologies such as thinner 
filaments and less conductive inert fill gas but did not develop an 
energy efficiency level that included these options. (Joint Advocates, 
No. 113 at pp. 3-4)
    Regarding design options incorporated into the modeled HIR lamp, 
DOE notes that the incorporation of certain design options may affect 
other aspects of lamp operation and/or increase the cost of the lamp. 
After reviewing the comments and reviewing images of the label on the 
product previously offered by GE, DOE concludes that the modeled HIR 
lamp incorporates the following technology options: Higher temperature 
operation, higher pressure operation, IR glass coatings, and higher 
efficiency burners. As described in the September 2019 GSIL NOPD, IR 
coatings on incandescent lamps are used to reflect some of the radiant 
energy emitted back onto the filament which can result in higher 
temperature operation. Further, as described by NEMA and GE, a halogen 
capsule with an IR coating operates at a much higher pressure than a 
standard halogen capsule. Thus, applying an IR coating also results in 
higher temperature and higher pressure operation. (GE, Public Meeting 
Transcript, No. 56 at p. 53; NEMA, No. 88 at p. 5) In addition, the 
image of the label for the 45 watt HIR lamp previously offered by GE 
shows a double-ended burner. As stated in the 2009 IRL final rule, 
double-ended burners are more efficient than single-ended burners 
because the lead wire inside of a single-ended burner prevents a 
certain amount of energy from reaching the burner wall and being 
reflected back to the 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 burner wall back to the filament). 74 FR 
34080, 34106-34107 (July 14, 2019). Thus, the modeled lamp in the 
engineering analysis also incorporates the most efficient burner.
    Although DOE identified higher efficiency fill gas and thinner 
filaments as design options, DOE does not incorporate them into the 
modeled HIR lamp. DOE lacks information regarding the specific gas 
composition in the capsule of the GE lamp previously offered for sale, 
and therefore it lacks information regarding the efficacy improvement 
possible from improving the fill gas. Further, DOE is not aware whether 
the filament of the GE HIR lamp can be improved. As stated by NEMA, 
thinner filaments in an HIR lamp require tighter coil spacing in order 
to maintain efficacy and avoid ``hot shock'' issues, which leads to 
early failure of the lamp. (NEMA, No. 88 at p. 6) It is unclear if 
using a thinner filament than that used in the GE HIR lamp would cause 
the lamp's lifetime to decrease due to ``hot shock.''
    DOE received several comments regarding other more efficacious 
substitutes that could have been included in the analysis. The Joint 
Advocates commented that DOE modeled a lamp that was less economically 
desirable than the product offered for sale by GE. (Joint Advocates, 
No. 113 at pp. 3-4) NRDC agreed and stated that it was odd that DOE 
failed to analyze the actual lamp that was sold by GE. (NRDC, No. 97 at 
p. 4)
    DOE did not directly analyze the GE HIR lamp previously offered for 
sale because its wattage (45 watts) was higher than the wattage of the 
baseline lamp (43 watts). Energy conservation standards prescribed by 
DOE 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)) Further, relevant 
to GSILs, EPCA defines an ``energy conservation standard'' as a 
performance standard which prescribes a minimum level of energy 
efficiency or a maximum quantity of energy use. (42 U.S.C. 6291(6)(A)) 
In accordance with these statutory provisions, the engineering analysis 
evaluates only

[[Page 71647]]

energy-saving substitutes in the engineering analysis.
    Several commenters stated that even though DOE considered a more 
efficacious substitute that utilized IR coatings, DOE did not consider 
the maximum efficacy that could be achieved using HIR technology. NRDC 
stated that GSILs have been introduced to the market with higher 
efficacies and lower prices than the more efficacious substitute 
considered by DOE. As a result, NRDC argued, DOE's analysis 
underestimates potential benefits and overstates the cost of updated 
efficiency standards for GSILs. NRDC stated that DOE must update its 
analysis with additional ELs prior to the issuance of a final rule. 
(NRDC, Public Meeting Transcript, No. 56 at p. 16) The Joint Advocates 
stated that Venture Lighting had previously offered an HIR lamp 
(``Vybrant 2X'') at a higher efficiency and longer life than the one 
DOE analyzed at max tech. The Joint Advocates noted that the lamp used 
a less expensive technique for applying the IR coating to the halogen 
capsule and was sold at $3.50 per bulb. The Joint Advocates were 
unaware of any consumer concerns about the performance or longevity of 
the lamp. (Joint Advocates, No. 113 at pp. 4-5, 7) NRDC provided 
details that Venture Lighting offered a 50 W replacement for the 100 W 
incandescent lamp and a 30 W replacement for the 60 W incandescent and 
43 W halogen incandescent lamps. (NRDC, No. 97 at p. 4) Further the 
Joint Advocates noted that Technical Consumer Products (TCP) had 
announced an HIR lamp with an even higher efficiency than the Vybrant 
2X for a similar price, but that it was never commercially introduced 
in the U.S. (Joint Advocates, No. 113 at pp. 4-5, 7) NRDC noted that 
the TCP lamp had 2,000-hour lifetime. (NRDC, No. 97 at p. 4)
    Regarding Venture Lighting's high efficiency HIR lamp, NEMA stated 
that it was available for three months before it was withdrawn because 
the lamp filament would cross over on itself resulting in a shortened 
lifetime or immediate failure (referred to as ``hot shock''). NEMA 
explained that the lamp filament needs to be positioned precisely to 
maximize absorption of infrared light and maximize lamp efficacy. This 
poses mechanical and chemical constraints on filament construction and 
material as well as design challenges to accommodate other components 
of the lamp structure such as a fuse link, which is required for safe 
operation of the lamp. NEMA noted that the expense of overcoming these 
design challenges would not result in a cost-effective product for the 
consumer. NEMA stated that Venture Lighting decided that the product 
could not be commercialized due to the technical and cost issues. 
(NEMA, No. 88 at pp. 9-10)
    DOE appreciates the comments regarding more efficient HIR lamps. 
However, for the reasons that follow, DOE did not use them to develop a 
more efficacious lamp than the one modeled in the September 2019 GSIL 
NOPD. Commenters focused on two products when stating that DOE should 
consider a more efficacious lamp than that considered in the September 
2019 GSIL NOPD: A lamp advertised by TCP and a lamp sold by Venture 
Lighting, known as the Vybrant 2X lamp. Commenters indicate that both 
lamps utilize, or were advertised to utilize, HIR technology to achieve 
efficacies greater than the lamp modeled by DOE in the September 2019 
GSIL NOPD. While the TCP lamp was announced in 2011, it was never 
commercially introduced for sale. DOE did not base a more efficacious 
substitute on the TCP product because it is unclear whether the 
advertised performance characteristics would have remained the same 
when it was manufactured on a commercial scale. Further, TCP informed 
NEMA that the lamp was never offered for sale because the cost of the 
product was too high. (NEMA, No. 329 at p. 38) \33\ As the cost is only 
identified as ``too high,'' it is also unclear what the cost of the 
product would be in the retail market. The Vybrant 2X lamp, in 
contrast, was offered for sale for a period of three months in 2013 via 
Venture's website. Commenters state that it was priced at $3.50 in 
2013. (Joint Advocates, No. 113 at pp. 4; NRDC, No. 97 at p. 4) Venture 
informed NEMA that the Vybrant 2X lamp was withdrawn for technical and 
product performance reasons because the lamp experienced ``hot shock'' 
issues whereby the filament would cross over on itself and create short 
life or immediate failure. Because of these technical issues and 
because of cost issues, Venture concluded the product would not be 
commercialized and discontinued the product. (NEMA, No. 329 at p. 38) 
\34\ DOE did not base a more efficacious substitute on the Vybrant 2X 
lamp offered by Venture because the lifetime of the lamp did not appear 
to meet the advertised value and it was unclear what value should be 
used for the actual lifetime. There is a relationship between lifetime, 
wattage, and lumen output for incandescent/halogen lamps, and absent 
all three pieces of information it is not possible to fairly compare 
the level of technology from one lamp to another. For these reasons, 
DOE did not model a more efficacious substitute with an efficacy 
greater than that of the HIR lamp modeled in the September 2019 GSIL 
NOPD.
---------------------------------------------------------------------------

    \33\ This comment was submitted in response to docket number 
EERE-2018-BT-STD-0010 and is available here: https://www.regulations.gov/document?D=EERE-2018-BT-STD-0010-0329.
    \34\ This comment was submitted in response to docket number 
EERE-2018-BT-STD-0010 and is available here: https://www.regulations.gov/document?D=EERE-2018-BT-STD-0010-0329.
---------------------------------------------------------------------------

    Regarding the lamp modeled in the September 2019 GSIL NOPD, while 
DOE changed the lumen output of the GE lamp previously offered for sale 
(870 lumens) to be equal to that the lumen output of the baseline lamp 
(750 lumens), several stakeholders commented on DOE's approach to 
changing the lifetime of the GE lamp (3,000 hours) to be equal to that 
of the baseline lamp (1,000 hours). GE stated that the minimum lifetime 
allowed under current regulations, 1,000 hours, will produce the most 
efficacious design possible. (GE, No. 78 at p. 2) However, NEMA and GE 
stated that while they agreed with the performance characteristics of 
the HIR lamp modeled by DOE, they believe that consumers will receive 
better economic value for a 3,000-hour HIR lamp rather than one that is 
1,000 hours as modeled by DOE. (NEMA, No. 88 at p. 8; GE, Public 
Meeting Transcript, No. 56 at pp. 49-50) NEMA stated that modeling the 
substitute at 1,000 hours to reduce the wattage does not lower the 
initial cost of the lamp but does decrease the hours to recover the 
cost. Specifically, NEMA stated that the 10.7 watts energy saving of 
efficiency level (``EL'') 1 over the baseline, would yield a $1.40 
saving over a period of 1,000 hours (at $0.1312/kWh), which does not 
justify paying $6.00 more for the lamp. NEMA added this is supported by 
GE's and Philip's business decision to offer a longer-life lamp. (NEMA, 
No. 88 at p. 8)
    The Joint Advocates stated that DOE took an ``economically 
unacceptable'' product and hypothesized an even less economically 
acceptable version on which to base its analysis. (Joint Advocates, No. 
113 at pp. 3-4) IPI stated that DOE did not consider lamp options with 
comparable performance to EL 1 but with a different lifetime, and thus 
did not consider the impact of such options on cost and the payback 
period. (IPI, No. 96 at pp. 6-7) The Joint Advocates recommended that 
DOE evaluate an efficacy level below EL 1 (EL 0.5) that achieves a 26 
percent improvement over the baseline based on a 43 W lamp that has a 
lumen output

[[Page 71648]]

of 800 lumens and lifetime of 3,000 hours. (Joint Advocates, No. 113 at 
p. 5)
    DOE analyzes energy-saving substitutes in the engineering analysis. 
As described previously in this section, because the wattage of the 
commercially available GE lamp was greater than that of the baseline 
lamp, DOE adjusted the performance characteristics to create an energy-
saving substitute. Adjusting both the lifetime and the lumen output 
resulted in a lamp with the lowest possible wattage (i.e., the most 
energy-saving substitute). However, DOE acknowledges that adjusting 
both lifetime and lumen output is not necessary to create an energy-
saving substitute. If DOE adjusts only the lumen output to be equal to 
that of the baseline lamp, the wattage decreases from 45 watts to 39.3 
watts. The lifetime of 3,000 hours would be maintained. DOE analyzes 
this lamp as a new option at EL 0.5 in this final determination. The 
performance characteristics of the modeled HIR lamps are shown in Table 
VI.4.

                                                      Table VI.4--More Efficacious GSIL Substitutes
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                         Rated lifetime   Efficacy  (lm/
                  EL                             Technology              Wattage         Bulb shape    Initial  lumens       (hrs)              W)
--------------------------------------------------------------------------------------------------------------------------------------------------------
EL 0.5................................  HIR........................            39.3              A19              750            3,000             19.1
EL 1..................................  HIR........................            34.3              A19              750            1,000             21.9
--------------------------------------------------------------------------------------------------------------------------------------------------------

4. Efficacy Levels
    After identifying more-efficacious substitutes for the baseline 
lamp, DOE developed ELs based on the consideration of several factors, 
including: (1) The design options associated with the specific lamps 
being studied, (2) the ability of lamps across lumen outputs to comply 
with the standard level of a given product class, and (3) the max-tech 
level.
    In the September 2019 GSIL NOPD, DOE employed an equation-based 
approach for efficacy levels. DOE considered the following equation 
that relates the lumen output of a lamp to lamp efficacy:

Efficacy = A-29.42 * 0.9983 \initial lumen output\                                                   Equation 1
 

where A is a constant that varies by EL. The equation characterizes 
efficacy as sharply increasing as lumen output increases at the lowest 
part of the lumen range and then the increase slows down such that a 
curve is formed with a steep slope at the low end of the lumen range 
and a flatter slope at the high end of the lumen range.
    DOE did not receive any comments regarding the form of the equation 
and therefore continues to use the same equation form in this final 
determination.
    As described in section VI.B.3, DOE identified, through modeling, 
two more efficacious GSIL substitutes. DOE developed two ELs based on 
the efficacies of the modeled lamps. Table VI.5 summarizes the ELs 
developed by the engineering analysis.

                              Table VI.5--ELs for GSIL Representative Product Class
----------------------------------------------------------------------------------------------------------------
   Representative product class      Efficacy level                        Efficacy  (lm/W)
----------------------------------------------------------------------------------------------------------------
Standard Spectrum GSILs..........  EL 0.5             27.2-29.42 * 0.9983 [caret] Initial Lumen Output.
                                   EL 1               30.0-29.42 * 0.9983 [caret] Initial Lumen Output.
----------------------------------------------------------------------------------------------------------------

5. Scaling to Other Product Classes
    DOE identifies and selects certain product classes as 
representative and analyzes these product classes directly. DOE chooses 
representative product classes primarily due to their high market 
volumes. The ELs for product classes that are not directly analyzed 
(``non-representative product classes'') are then determined by scaling 
the ELs of the representative product classes. For this rulemaking, DOE 
directly analyzed standard spectrum GSILs but did not directly analyze 
modified spectrum GSILs.
    DOE developed an EL for the modified spectrum product class by 
scaling the EL of the standard spectrum product class. The primary 
difference between these product classes is the lamp spectrum; a 
coating applied to the lamp modifies its spectral emission but also 
decreases its efficacy. DOE developed a scaling factor by comparing 
existing standards for standard spectrum GSILs to similar modified 
spectrum GSILs. DOE determined that the modified spectrum lamps are 25 
percent less efficacious than standard spectrum lamps. DOE applied this 
reduction to the A-value for the EL developed in section VI.B.4 of this 
document.
    CA IOUs commented that a reduced efficacy allowance for modified 
spectrum lamps is not needed. CA IOUs noted that in incandescent lamps, 
light spectrum is modified by filtering out certain wavelengths after 
they are generated whereas high efficacy light sources can be designed 
to produce the desired wavelengths and without reducing efficacy. (CA 
IOUs, No. 83 at pp. 3-4).
    As discussed in section V, the covered products in this rulemaking 
are GSILs. Therefore, DOE did not consider CFL or LED lamps when 
establishing product classes or determining the appropriate scaling 
factor. As indicated by the existing standards for GSILs, modified 
spectrum lamps cannot be as efficient as standard spectrum lamps. DOE 
did not receive any adverse comments to reducing efficacy levels by 25 
percent to account for the capabilities of modified spectrum GSILs. DOE 
therefore continues to use this scaling factor in the final 
determination.
    Table VI.6 summarizes the efficacy requirements for the non-
representative product class.

[[Page 71649]]



                            Table VI.6--ELs for GSIL Non-Representative Product Class
----------------------------------------------------------------------------------------------------------------
 Non-representative product class    Efficacy level                        Efficacy  (lm/W)
----------------------------------------------------------------------------------------------------------------
Modified Spectrum GSILs..........  EL 0.5             20.4-29.42 * 0.9983 [caret] Initial Lumen Output.
                                   EL 1               22.5-29.42 * 0.9983 [caret] Initial Lumen Output.
----------------------------------------------------------------------------------------------------------------

6. Product Substitutes
    If energy conservation standards for GSILs are amended, consumers 
may substitute alternative lamps that are not GSILs. In the September 
2019 GSIL NOPD, DOE considered several alternatives available to 
consumers that have the same base type (medium screw base) and input 
voltage (120 volts) as the baseline lamp. DOE considered two more 
efficacious lamps that consumers may choose if standards for GSILs are 
amended: A CFL and an LED lamp. For consumers who are resistant to 
changing technology, and for those who are trying to replace a 60 watt 
incandescent lamp with a 60 watt replacement, DOE also considered a 
shatter-resistant incandescent lamp that is exempt from the definition 
of GSIL. Because this lamp is not a GSIL, it would not be subject to 
amended standards for GSILs and would remain available on the market.
    Several commenters agreed that LED lamps were a likely substitute 
for GSILs; compared to the modeled HIR lamp, LED lamps were 
significantly more efficient and had a longer lifetime while also being 
less expensive. The Joint Advocates stated that LED lamps are more than 
five times as efficient as halogen lamps and last ten times as long. 
(Joint Advocates, No. 113 at p. 1) NRDC stated that LED lamps are 
extremely cost-effective replacements for incandescent and halogen 
lamps and are available in a wide range of shapes, base types, and 
brightness levels. (NRDC, Public Meeting Transcript, No. 56 at pp. 13-
14) PA DEP explained that LED lamps are readily available as a 
replacement option for all GSIL applications. (PA DEP, No. 77 at p. 2) 
CFA stated that both CFL and LED technologies have much higher 
efficiencies and lower costs than the HIR level analyzed. (CFA, No. 76 
at p. 5) An individual commented that store shelves are stocked with 
LED lamps because they are efficient, cheap, and dimmable. (Dufford, 
No. 32 at p. 1).
    DOE also received several comments regarding the shatter-resistant 
incandescent lamp. The State Attorneys General and the Joint Advocates 
stated that DOE's scenarios in the September 2019 GSIL NOPD were 
unrealistic and over-estimated costs associated with more stringent 
GSIL standards because DOE assumed consumers would substitute GSILs 
with shatter-proof lamps but did not account for the fact that if 
shatter-proof lamp sales increased, DOE would be required to establish 
standards for these lamps or EPCA's backstop specific to these lamps 
would be triggered. (State Attorneys General, No. 110 at p. 16; Joint 
Advocates, No. 113 at p. 6) The State Attorneys General noted that 
exempt shatter-resistant incandescent lamps consume more energy than 
other substitutes such as CFL or LED lamps. (State Attorneys General, 
No. 110 at p. 16) NEMA commented that data available to and published 
by DOE indicates that shipments of this product have been steadily 
declining for over a decade now, and there is absolutely no evidence of 
substitution of shatter-resistant lamps for GSILs, CFLs or general 
service LEDs. Shipments of the shatter-resistant incandescent lamps 
have declined 67 percent since 2011. NEMA explained that a shatter-
resistant lamp has special coating to contain the glass if the glass 
envelope is broken. NEMA added that the lamp's reduced lumen output due 
to the coating will affect consumer acceptance as a meaningful 
substitute for a GSIL or a GSL and that these lamps are usually used in 
food service, food manufacturing, water treatment, and other industrial 
applications. (NEMA, No. 88 at pp. 11-12).
    DOE agrees with commenters that a separate backstop provision 
applies to shatter-resistant incandescent lamps if sales exceed a 
certain threshold. The shipments of shatter-resistant incandescent 
lamps forecasted in the September 2019 GSIL NOPD would have exceeded 
that threshold and therefore DOE would have had to complete an 
accelerated rulemaking or impose a maximum wattage limitation of 40 
watts and a requirement that those lamps be sold at retail only in a 
package containing one lamp. 42 U.S.C. 6295(l)(4)(H) In this final 
determination, DOE removed the shatter-resistant incandescent lamp as 
an option that consumers may choose in response to a higher standard 
for GSILs because the lumen output of a 40 watt shatter-resistant 
incandescent lamp would be insufficient for people replacing a 43 watt 
halogen GSIL. Whereas the halogen GSIL has a lumen output of 750 
lumens, 40 watt shatter-resistant lamps have lumen outputs from about 
265 lumens to 415 lumens.
    Table VI.7 summarizes the performance characteristics of the GSIL 
alternatives that consumers can choose if GSIL standards are amended.

                                            Table VI.7--Alternative Lamps Consumers May Substitute for GSILs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                               Rated
               Option                        Technology             Wattage            Bulb shape             Initial        lifetime     Efficacy  (lm/
                                                                                                              lumens           (hrs)            W)
--------------------------------------------------------------------------------------------------------------------------------------------------------
A..................................  CFL......................              13  Spiral..................             900          10,000            69.2
B..................................  LED......................               9  A19.....................             800          15,000            88.9
--------------------------------------------------------------------------------------------------------------------------------------------------------

C. Product Price Determination

    Typically, DOE develops manufacturer selling prices (``MSPs'') for 
covered products and applies markups to create end-user prices to use 
as inputs to the LCC analysis and NIA. Because GSILs are difficult to 
reverse-engineer (i.e., not easily disassembled), DOE directly derives 
end-user prices for GSILs. End-user price refers to the product price a 
consumer pays before tax and installation.
    In the September 2019 GSIL NOPD, DOE used the same methodology as 
the March 2016 GSL NOPR to calculate the prices for the GSIL baseline 
lamp and the consumer choice alternatives. GSILs and the consumer 
choice alternatives

[[Page 71650]]

are purchased through the same distribution channels as the CFL and LED 
lamps analyzed in the March 2016 GSL NOPR. Because DOE modeled an HIR 
lamp at EL 1, which is not currently commercially available, DOE could 
not gather prices for commercially available lamps and use the same 
methodology. Instead, for the modeled HIR lamp in the September 2019 
GSIL NOPD, DOE added the incremental change in end-user price from the 
2015 IRL final rule to the price of the baseline halogen GSIL.
    DOE received several comments regarding the price of the HIR lamp 
at EL 1. Some commenters supported the price determined by DOE. 
According to GE the HIR lamp it used to sell was expensive to make 
because of how it was constructed as well as the heavy glass covering 
required due to the higher pressure of the filament tube. (GE, Public 
Meeting Transcript, No. 56 at p. 53) GE stated that the numerous layers 
of coatings required on the filament tubes made it a slow and a 
laborious process that could not be done on a high-speed production 
line. (GE, Public Meeting Transcript, No. 56 at p. 59) NEMA noted that 
the slow batch production made it difficult for the GE and Philips HIR 
lamps to attain the same economies scale that a lower cost halogen lamp 
would have. (NEMA, No. 88 at p. 9) NEMA explained that the halogen IR 
tube is 6 to 8 times more expensive than the halogen incandescent 
capsule. (NEMA, No. 88 at p. 5) NEMA also noted that manufacturers 
indicated that there are distinct safety issues with the halogen IR 
lamp. One manufacturer's safety protocol required the lamp to be sold 
in an expensive heavy glass outer jacket to contain a filament tube 
rupture (the halogen IR filament tube operates at a much higher 
pressure than standard halogen capsules). Another manufacturer 
addressed the safety issue by operating its halogen IR filament tube at 
a low voltage, but this required an expensive electronic transformer in 
each lamp. Either solution was very expensive. (NEMA, No. 88 at p. 5) 
While DOE had calculated an incremental production cost for HIR 
technology using information from the 2015 IRL rulemaking, NEMA noted 
that switching from a standard to a more expensive IR halogen burner 
increases the price by a much higher percentage in a general service A-
line incandescent lamp compared to a Parabolic Reflector (PAR) Lamp. 
(NEMA, No. 88 at p. 5)
    In contrast, several commenters disagreed with the price determined 
by DOE and stated that it should be lower. The Joint Advocates stated 
that DOE provides no explanation of how the incremental value of $5.19 
was determined. (Joint Advocates, No. 113 at p. 5) IPI noted that DOE 
had stated that it had used the IRL prices derived in the 2015 IRL 
rulemaking to develop the price for the modeled HIR lamp. However, IPI 
stated that the 2015 IRL rulemaking showed a difference of $2.62 in 
2018$ between the baseline IRL and the HIR IRL while in the September 
2019 GSIL NOPD analysis the difference between the baseline GSIL and 
the modeled HIR lamp was $5.19 in 2018$. IPI added that there was a 
1,000-hour difference between the baseline IRL and HIR IRL lamp and DOE 
never explains how this was accounted for in using the IRL price 
differential to develop the price of the modeled HIR lamp. (IPI, No. 96 
at p. 6) NRDC noted that HIR lamps had previously been sold at about 
$3.50 before any volume increases. (NRDC, Public Meeting Transcript, 
No. 56 at pp. 58-59) The Joint Advocates added that DOE should have 
determined the incremental cost using the price of the Venture Lighting 
Vybrant 2X lamp ($3.93 in 2019$) which had not experienced the high 
product costs of the more expensive IRL lamps. This would have resulted 
in an incremental cost of $3.39 in 2019$. (Joint Advocates, No. 113 at 
p. 5)
    Westinghouse countered that due to the cost of the burner, 
complexity of the filament position, the specific filament type, and 
the coating process, it did not understand how the Vibrant 2X lamp 
could be sold at $3.50. Westinghouse reasoned that it may have been an 
attempt to gain market share that would later offset costs or to close 
out inventory. Westinghouse added that for the price to be that low, 
one of the manufacturers would have to absorb the up-front capital 
investment until volume caught up, and that such a manufacturer would 
never absorb the cost. (Westinghouse, Public Meeting Transcript, No. 56 
at pp. 60-61)
    CFA stated that based on a study of approaches used by DOE 
programs, there is a consistent tendency for product costs to be much 
lower than projected by the agency. CFA asserted that this is due to 
setting standards that set a performance level but not dictating the 
technologies that can be used to achieve the level. CFA commented that 
this results in companies producing the lowest possible cost product 
that meets standards. (CFA, No. 76 at p. 15)
    Regarding the Vybrant 2X lamp, DOE notes that although it may have 
been sold for a period of time at $3.50, as discussed in section VI.B.3 
it is unclear what the lifetime of the lamp was given that the lamp 
experienced early failure and was ultimately withdrawn for technical 
reasons. Because DOE could not confirm the performance characteristics 
associated with the $3.50 Vybrant 2X lamp, DOE did not consider the 
lamp in its determination of the price of the modeled HIR lamps.
    DOE reviewed its methodology for calculating the price of the 
modeled HIR lamp in light of the comments received. NEMA noted that the 
halogen IR filament tube operates at a much higher pressure than 
standard halogen capsules. Manufacturers have dealt with this in two 
distinct ways: Adding an expensive heavy glass outer jacket or 
operating the halogen IR filament tube at a low voltage by adding an 
expensive electronic transformer. DOE's review of its methodology from 
the September 2019 GSIL NOPD concluded that this change in cost due to 
safety issues was not included because the PAR-shaped IRLs analyzed in 
the 2015 rulemaking use different glass than GSILs and the PAR glass 
does not require alteration in the presence of an IR-coated halogen 
capsule.
    For the final determination, DOE has revised its pricing 
methodology to account for lamp adaptations that are necessary for 
safety reasons in the presence of an IR-coated halogen capsule. Instead 
of calculating the incremental change in cost for adding an IR-coated 
capsule to a halogen lamp based on the change in cost of an IRL, DOE 
calculated the incremental change in cost based on the change in cost 
of a GSIL. Specifically, DOE used the pricing information provided by 
GE for a halogen and HIR GSIL to calculate the cost of adding an IR-
coated halogen capsule and otherwise modifying the lamp to account for 
the safety concerns of higher-pressure operation. Per NEMA's comment in 
response to the March 2016 GSL NOPR, the average price of the GE HIR 
lamp was $7 compared to the $1.25 price for the 1,000 hour halogen 
lamp, resulting in an incremental increase of $5.75 in 2012$ (NEMA also 
stated in that comment that GE's HIR lamp was withdrawn in 2012). Using 
the consumer price index to inflate the incremental cost to 2018$, DOE 
calculated the incremental cost to be $6.29 in 2018$ and added that 
cost to the price for the baseline halogen lamp from the September 2019 
GSIL NOPD. Because both more efficacious substitutes are derived from 
the same GE lamp, they are the same price.
    Table VI.8 summarizes the prices of the GSILs analyzed in this 
rulemaking and Table VI.9 summarizes the prices of the alternative 
lamps consumers may choose if standards for GSILs are amended.

[[Page 71651]]



                                                          Table VI.8--End-User Prices for GSILs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                               Rated
                   EL                               Technology                Wattage         Initial        lifetime     Efficacy  (lm/     End-user
                                                                                              lumens           (hrs)            W)             price
--------------------------------------------------------------------------------------------------------------------------------------------------------
EL 0....................................  Halogen.......................              43             750           1,000            17.4           $1.81
EL 0.5..................................  HIR...........................            39.3             750           3,000            19.1            8.10
EL 1....................................  HIR...........................            34.3             750           1,000            21.9            8.10
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                              Table VI.9--End-User Prices for Consumer Choice Alternatives
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                               Rated
                 Option                             Technology                Wattage         Initial        lifetime     Efficacy  (lm/     End-user
                                                                                              lumens           (hrs)            W)             price
--------------------------------------------------------------------------------------------------------------------------------------------------------
A.......................................  CFL...........................              13             900          10,000            69.2           $2.94
B.......................................  LED...........................               9             800          15,000            88.9            3.00
--------------------------------------------------------------------------------------------------------------------------------------------------------

D. Energy Use Analysis

    The purpose of the energy use analysis is to determine the annual 
energy consumption of GSILs in representative U.S. single-family homes, 
multi-family residences, and commercial buildings, and to assess the 
energy savings potential of an amended energy conservation standard 
applied to GSILs. To develop annual energy use estimates, DOE 
multiplied GSIL input power by the number of hours of use (``HOU'') per 
year and a factor representing the impact of controls. The energy use 
analysis estimates the range of energy use of GSILs in the field (i.e., 
as they are actually used by consumers). The energy use analysis 
provides the basis for other analyses DOE performed, particularly 
assessments of the energy savings and the savings in consumer operating 
costs that could result from adoption of amended or new standards.
    DOE analyzed energy use in the residential and commercial sectors 
separately but did not explicitly analyze GSILs installed in the 
industrial sector. This is because far fewer GSILs are installed in 
that sector compared to the commercial sector, and the average 
operating hours for GSILs in the two sectors were assumed to be 
approximately equal. In the energy use and subsequent analyses, DOE 
analyzed these sectors together (using data specific to the commercial 
sector), and refers to the combined sector as the commercial sector.
    All comments received on the energy use methodology from the 
September 2019 GSIL NOPD were supportive (GE, No. 78 at p. 2; NEMA, No. 
88 at p. 8; Westinghouse, No. 112 at p. 1) and DOE has continued to use 
the same methodology in the final determination.
1. Operating Hours
a. Residential Sector
    To take into account the regional variability in the average HOU of 
GSILs in the residential sector--which were assumed to have similar HOU 
to medium screw base (``MSB'') A-type lamps--DOE used data from various 
regional field-metering studies of GSL operating hours conducted across 
the U.S. Chapter 7 of the final determination TSD lists the regional 
metering studies used. Specifically, DOE determined the average HOU for 
each Energy Information Association (``EIA'') 2015 Residential Energy 
Consumption Survey (``RECS'') reportable domain (i.e., state, or group 
of states).\35\ \36\ For regions without HOU metered data, DOE used 
data from adjacent regions. DOE estimated the national weighted-average 
HOU of GSILs in the residential sector to be 2.3 hours per day.
---------------------------------------------------------------------------

    \35\ The 2015 RECS provided detail only to the division, not 
reportable domain, level; therefore, in creating its residential 
consumer sample DOE randomly assigned a RECS reportable domain to 
each consumer based on the reportable domain breakdown from RECS 
2009.
    \36\ U.S. Department of Energy--Energy Information 
Administration. 2015 RECS Survey Data. (Last accessed July 2, 2019.) 
https://www.eia.gov/consumption/residential/data/2015/.
---------------------------------------------------------------------------

    The operating hours of lamps in actual use are known to vary 
significantly based on the room type the lamp is located in. Therefore, 
DOE estimated this variability by developing HOU distributions for each 
room type using data from Northwest Energy Efficiency Alliance's 
(NEEA's) Residential Building Stock Assessment Metering Study 
(RBSAM),\37\ a metering study of 101 single-family houses in the 
Northwest. DOE assumed that the shape of the HOU distribution for a 
particular room type would be the same across the United States, even 
if the average HOU for that room type varied by geographic location. To 
determine the distribution of GSILs by room type, DOE used data from 
NEEA's 2011 RBSAM for single-family homes,\38\ which included GSL room-
distribution data for more than 1,400 single-family homes throughout 
the Northwest.
---------------------------------------------------------------------------

    \37\ Ecotope Inc. Residential Building Stock Assessment: 
Metering Study. 2014. Northwest Energy Efficiency Alliance: Seattle, 
WA. Report No. E14-283. (Last accessed July 5, 2019.) https://neea.org/resources/2011-rbsa-metering-study.
    \38\ Northwest Energy Efficiency Alliance. 2011 Residential 
Building Stock Assessment Single-Family Database. (Last accessed 
July 5, 2019.) https://neea.org/resources/2011-rbsa-single-family-database.
---------------------------------------------------------------------------

b. Commercial Sector
    For each commercial building type presented in the 2015 Lighting 
Market Characterization (``LMC''), DOE determined average HOU based on 
the fraction of installed lamps utilizing each of the light source 
technologies typically used in GSLs and the HOU for each of these light 
source technologies. DOE estimated the national-average HOU for the 
commercial sector by weighting the building-specific HOU for GSLs by 
the relative floor space of each building type as reported in in the 
2012 EIA Commercial Buildings Energy Consumption Survey 
(``CBECS'').\39\ The national weighted-average HOU for GSLs, and 
therefore GSILs, in the commercial sector was estimated at 11.8 hours 
per day. To capture the variability in HOU for individual consumers in 
the commercial sector, DOE used data from NEEA's 2014 Commercial 
Building Stock Assessment (CBSA).\40\ As for the

[[Page 71652]]

residential sector, DOE assumed that the shape of the HOU distribution 
from the CBSA was similar for the U.S. as a whole.
---------------------------------------------------------------------------

    \39\ U.S. Department of Energy--Energy Information 
Administration. 2012 CBECS Survey Data. (Last accessed July 5, 
2019.) http://www.eia.gov/consumption/commercial/data/2012/index.cfm?view=microdata.
    \40\ Navigant Consulting, Inc. 2014 Commercial Building Stock 
Assessment: Final Report. 2014. Northwest Energy Efficiency 
Alliance: Seattle, WA. (Last accessed July 5, 2019.) https://neea.org/resources/2014-cbsa-final-report.
---------------------------------------------------------------------------

2. Input Power
    The input power used in the energy use analysis is the input power 
presented in the engineering analysis (section VI.B) for the 
representative lamps considered in this rulemaking.
3. Lighting Controls
    For GSILs that operate with controls, DOE assumed an average energy 
reduction of 30 percent. This estimate was based on a meta-analysis of 
field measurements of energy savings from commercial lighting controls 
by Williams, et al.,\41\ because field measurements of energy savings 
from controls in the residential sector are very limited, DOE assumed 
that controls would have the same impact as in the commercial sector.
---------------------------------------------------------------------------

    \41\ Williams, A., B. Atkinson, K. Garbesi, E. Page, and F. 
Rubinstein. Lighting Controls in Commercial Buildings. LEUKOS. 2012. 
8(3): pp. 161-180. (Last accessed July 5, 2019.) https://www.tandfonline.com/doi/abs/10.1582/LEUKOS.2012.08.03.001.
---------------------------------------------------------------------------

    DOE assumed that 9 percent of residential GSILs are on controls, 
which aligns with the fraction of lamps reported to be on dimmers or 
occupancy sensors in the 2015 LMC.
    DOE assumed that building codes would drive an increase in floor 
space utilizing controls in the commercial sector. DOE notes that the 
estimate of the impact of controls on energy consumption increases over 
time in the commercial sector, but does not require an update to the 
HOU estimate.

E. Life-Cycle Cost and Payback Period Analysis

    DOE conducted LCC and PBP analyses to evaluate the economic effects 
on individual consumers of potential energy conservation standards for 
GSILs. In particular, DOE performed LCC and PBP analyses to evaluate, 
in part, the savings in operating costs throughout the estimated 
average life of GSILs compared to any associated increase in costs 
likely to result from a TSL. The effect of new or amended energy 
conservation standards on individual consumers usually involves a 
reduction in operating cost and an increase in purchase cost. DOE used 
the following two metrics to measure effects on the consumer:
     The LCC (life-cycle cost) is the total consumer expense of 
an appliance or product, consisting of total installed cost 
(manufacturer selling price, distribution chain markups, sales tax, and 
installation costs) plus operating costs (expenses for energy use, 
maintenance, and repair) and any applicable disposal costs. To compute 
the operating costs, DOE discounts future operating costs to the time 
of purchase and sums them over the lifetime of the product. For this 
final determination, DOE presents annualized LCC because average GSIL 
lifetimes are less than a year in the commercial sector and because the 
lifetimes differ between ELs.
     The PBP (payback period) is the estimated amount of time 
(in years) it takes consumers to recover the increased purchase cost 
(including installation) of a more-efficient product through lower 
operating costs. DOE calculates a simple PBP by dividing the change in 
purchase cost at higher efficacy levels by the change in annual 
operating cost for the year that amended or new standards are assumed 
to take effect.\42\
---------------------------------------------------------------------------

    \42\ The simple payback period calculation does not account for 
the additional cost of any needed replacement lamps when comparing 
lamps with different lifetimes.
---------------------------------------------------------------------------

    DOE received a comment from an individual suggesting that the life-
cycle cost analysis should also include costs associated with mining, 
component manufacturing, and product assembly. (Anonymous, No. 98 at p. 
7) DOE notes that the life-cycle cost calculation is intended to 
provide an economic assessment from the consumer's perspective and 
includes only those costs a consumer would be sensitive to, such as the 
product price or operating costs. DOE also notes that mining, 
manufacturing, and assembly costs may be imbedded in the purchase 
price.
    For each considered standard level, DOE measures the change in 
annualized LCC relative to the annualized LCC in the no-new-standards 
case, which reflects the estimated efficacy distribution of GSILs in 
the absence of new or amended energy conservation standards. Due to the 
Department's statutory obligations to examine and compare the savings 
and cost increases for covered products, DOE presents LCC savings 
results for two scenarios with different efficacy distributions: DOE 
presents the LCC savings of GSILs, the covered product in this final 
determination, for a scenario representing only shipments of GSILs, and 
also includes LCC savings for a scenario that includes shipments of 
out-of-scope lamps as an input to the NPV calculation. This latter LCC 
savings is relevant as an input to the NPV, but it does not compare the 
savings and price increases of the covered product because it also 
includes out-of-scope products. For details on the two scenarios, see 
section VI.F of this document. The PBP for each efficacy level is 
measured relative to the baseline efficacy level. The LCC savings with 
substitution effects are not comparable to the PBP analysis because 
they extend beyond the covered product in this final determination.
    For each considered efficacy level, DOE calculated the annualized 
LCC and PBP for a nationally-representative set of potential customers. 
Separate calculations were conducted for the residential and commercial 
sectors. DOE developed consumer samples based on the 2015 RECS and the 
2012 CBECS for the residential and commercial sectors, respectively. 
For each consumer in the sample, DOE determined the energy consumption 
of the lamp purchased and the appropriate electricity price. By 
developing consumer samples, the analysis captured the variability in 
energy consumption and energy prices associated with the use of GSILs.
    DOE added sales tax, which varied by state, and installation cost 
(for the commercial sector) to the cost of the product developed in the 
product price determination to determine the total installed cost. 
Inputs to the calculation of operating expenses include annual energy 
consumption, energy prices and price projections, lamp lifetimes, and 
discount rates. DOE created distributions of values for lamp lifetimes, 
discount rates, and sales taxes, with probabilities attached to each 
value, to account for their uncertainty and variability.
    For a GSIL standard case (i.e., case where a standard would be in 
place at a particular TSL), DOE measured the annualized LCC savings 
resulting from the technological requirements for GSILs at the 
considered standard relative to the efficacy distribution in the no-
new-standards case for the covered product scenario. DOE also presents 
annualized LCC savings that include substitution effects and their 
effects on efficacy distribution in the standards case relative to the 
estimated efficacy distribution in the no-new-standards case for a 
scenario in which consumers can substitute out-of-scope products. The 
efficacy distributions in the substitution scenario include market 
trends that can result in some lamps with efficacies that exceed the 
minimum efficacy associated with the standard under consideration. In 
contrast, the PBP only considers the average time required to recover 
any increased first cost associated with a

[[Page 71653]]

purchase at a particular EL relative to the baseline product.
    The computer model DOE used to calculate the annualized LCC and PBP 
results relies on a Monte Carlo simulation to incorporate uncertainty 
and variability into the analysis. The Monte Carlo simulations randomly 
sample input values from the probability distributions and consumer 
user samples. The model calculated the annualized LCC and PBP for a 
sample of 10,000 consumers per simulation run.
    DOE calculated the annualized LCC and PBP as if each consumer were 
to purchase a new product in the expected year of required compliance 
with amended standards. Any amended standards would apply to GSILs 
manufactured 3 years after the date on which any amended standard is 
published. (42 U.S.C. 6295(i)(6)(A)(iii)) As this final determination 
is expected to publish by the end of 2019, DOE used 2023 as the first 
full year in which compliance with any amended standards for GSILs 
could occur.
    Table VI.10 summarizes the approach and data DOE used to derive 
inputs to the LCC and PBP calculations. The subsections that follow 
provide further discussion. Details of the spreadsheet model, and of 
all the inputs to the LCC and PBP analyses, are contained in chapter 8 
of the final determination TSD and its appendices.

 Table VI.10--Summary of Inputs and Methods for the LCC and PBP Analysis
                                 * \43\
------------------------------------------------------------------------
                 Inputs                            Source/method
------------------------------------------------------------------------
Product Cost............................  Weighted-average end-user
                                           price determined in the
                                           product price determination.
                                           For the LCC with
                                           substitution, DOE used a
                                           price-learning analysis to
                                           project the price of the CFL
                                           and LED lamp alternatives in
                                           the compliance year.
Sales Tax...............................  Derived 2023 population-
                                           weighted-average tax values
                                           for each state based on
                                           Census population projections
                                           and sales tax data from Sales
                                           Tax Clearinghouse.
Installation Costs......................  Used RSMeans and U.S. Bureau
                                           of Labor Statistics data to
                                           estimate an installation cost
                                           of $1.54 per installed GSIL
                                           for the commercial sector.
Annual Energy Use.......................  Derived in the energy use
                                           analysis. Varies by
                                           geographic location and room
                                           type in the residential
                                           sector and by building type
                                           in the commercial sector.
Energy Prices...........................  Based on 2018 average and
                                           marginal electricity price
                                           data from the Edison Electric
                                           Institute. Electricity prices
                                           vary by season and U.S.
                                           region.
Energy Price Trends.....................  Based on AEO 2019 price
                                           forecasts.
Product Lifetime........................  A Weibull survival function is
                                           used to provide the survival
                                           probability as a function of
                                           GSIL age, based on the GSIL's
                                           rated lifetime, sector-
                                           specific HOU, and impact of
                                           dimming.
Discount Rates..........................  Approach involves identifying
                                           all possible debt or asset
                                           classes that might be used to
                                           purchase the considered
                                           appliances, or might be
                                           affected indirectly. Primary
                                           data source was the Federal
                                           Reserve Board's Survey of
                                           Consumer Finances.
Efficacy Distribution...................  Estimated by the market-share
                                           module of shipments model.
                                           See chapter 9 of the final
                                           determination TSD for
                                           details.
Compliance Date.........................  2023.
------------------------------------------------------------------------
* References for the data sources mentioned in this table are provided
  in the sections following the table or in chapter 8 of the final
  determination TSD.

1. Product Cost
    As noted in section VI.C, DOE rulemaking analyses typically 
calculate consumer product costs by multiplying MSPs developed in the 
engineering analysis by the markups along with sales taxes. For GSILs, 
the product price determination calculated end-user prices directly; 
therefore, for the LCC analysis, the only adjustment was to add sales 
taxes, which were assigned to each household or building in the LCC 
sample based on its location.
---------------------------------------------------------------------------

    \43\ Although DOE addresses the invalidity of California law 
relating to GSILs in the 2019 GSL Definition Rule, published on 
September 5, 2019, and reiterates that view in this final rule, in 
generating its consumer samples DOE did not sample consumers from 
California.
---------------------------------------------------------------------------

    In the LCC with substitution scenario, DOE used a price-learning 
analysis to determine the impact of GSIL standards on consumers who 
select a CFL or LED lamp alternative under a standard. The price-
learning analysis accounts for changes in lamp prices that are expected 
to occur between the time for which DOE has data for lamp prices (2018) 
and the assumed compliance date of the rulemaking (2023).
    DOE did not include price learning for HIR GSILs in the final 
determination, because DOE did not project any shipments of HIR GSILs 
since manufacturers are highly unlikely to produce these lamps given 
the upfront cost to bring such lamps to market. For details on the 
price-learning analysis, see section VI.F.1.b of this document.
2. Installation Cost
    Installation cost includes labor, overhead, and any miscellaneous 
materials and parts needed to install the product. For this final 
determination, DOE assumed an installation cost of $1.54 per installed 
commercial GSIL (based on RSMeans \44\ and U.S. Bureau of Labor 
Statistics data \45\), but zero installation cost for residential 
GSILs.
---------------------------------------------------------------------------

    \44\ RSMeans. Facilities Maintenance & Repair Cost Data 2013. 
2012. RSMeans: Kingston, MA.
    \45\ U.S. Department of Labor--Bureau of Labor Statistics. 
Occupational Employment and Wages, May 2018: 49-9071 Maintenance and 
Repair Workers, General. May 2018. (Last accessed July 30, 2019.) 
http://www.bls.gov/oes/current/oes499071.htm.
---------------------------------------------------------------------------

3. Annual Energy Consumption
    For each sampled household or commercial building, DOE determined 
the energy consumption for a lamp using the approach described 
previously in section VI.D of this document.
4. Energy Prices
    Consistent with the September 2019 GSIL NOPD, DOE used both 
marginal and average electricity prices to calculate operating costs. 
Specifically, DOE used average electricity prices for the baseline EL 
and marginal electricity prices to characterize incremental electricity 
cost savings associated with other TSLs. DOE estimated these prices 
using data published with the Edison Electric Institute Typical Bills 
and Average Rates reports for summer and winter 2018.\46\ DOE assigned 
seasonal marginal and average prices to each household in the LCC 
sample based on its location. DOE assigned seasonal marginal and 
average prices to each commercial building in the LCC sample

[[Page 71654]]

based on its location and annual energy consumption.
---------------------------------------------------------------------------

    \46\ Edison Electric Institute. Typical Bills and Average Rates 
Report. 2018. Winter 2018, Summer 2018: Washington, DC.
---------------------------------------------------------------------------

5. Energy Price Trends
    To arrive at electricity prices in future years, DOE multiplied the 
electricity prices described above by the forecast of annual 
residential or commercial electricity price changes for each Census 
division from EIA's Annual Energy Outlook (``AEO'') 2019, which has an 
end year of 2050.\47\ To estimate the trends after 2050, DOE used the 
compound annual growth rate of change between 2035 and 2050. For each 
purchase sampled, DOE applied the projection for the Census division in 
which the purchase was located. The AEO electricity price trends do not 
distinguish between marginal and average prices, so DOE used the same 
(AEO 2019) trends for both marginal and average prices.
---------------------------------------------------------------------------

    \47\ U.S. Energy Information Administration. Annual Energy 
Outlook 2019 with projections to 2050. 2019. Washington, DC. Report 
No. AEO2019. (Last accessed July 5, 2019.) https://www.eia.gov/outlooks/AEO/pdf/AEO2019.pdf.
---------------------------------------------------------------------------

    DOE used the electricity price trends associated with the AEO 
Reference case, which is a business-as-usual estimate, given known 
market, demographic, and technological trends. In response to this 
approach in the September 2019 GSIL NOPD, IPI commented that, while AEO 
2019 projects relatively flat residential and commercial electricity 
prices in the reference case, electricity prices can vary considerably 
across different scenarios. IPI said that the reference case does not 
account for potential future changes in laws and policies that could 
affect electricity prices. (IPI, No. 96 at pp. 7-8) IPI also commented 
that DOE should consider other reasonable assumptions about future 
electricity prices, and whether such assumptions would change its 
determinations. (Id.) DOE notes that in the context of a proposed or 
final rule, DOE does consider how the high- and low-growth AEO 
scenarios, including the associated electricity price trends, impact 
the analytical results and whether a standard would still be 
economically justified. However, in the context of a proposed or final 
determination, if the analytical results in the reference scenario 
indicate that a standard would not be economically justified, it is 
unnecessary to consider how the analytical results might differ under 
additional scenarios, as DOE would not set a standard that is not 
economically justified in the reference scenario.
6. Product Lifetime
    DOE considered the lamp lifetime to be the service lifetime (i.e., 
the age at which the lamp is retired from service). In the September 
2019 GSIL NOPD, DOE's lifetime model for halogen and HIR GSILs was 
based on a convolution of Weibull distributions that translated the 
rated lifetime and sector-specific operating hours distribution into a 
sector-specific distribution of survival probability, accounted for the 
increase in lifetime resulting from dimming, and served to bring 
historic shipments and stock of incandescent lamps into alignment. In 
the public meeting for the September 2019 GSIL NOPD, NRDC noted that 
DOE's average lifetime, in years, for halogen and HIR GSILs was longer 
than would be expected for lamps with a rated lifetime of 1,000 hours. 
(NRDC, Public Meeting Transcript, No. 56 at p. 102) For the final 
determination, DOE continues to use the approach from the September 
2019 GSIL NOPD to model historic shipments of GSILs and initialize the 
stock turnover model, but uses a simplified lifetime approach to 
project shipments of GSILs over the analysis period. In contrast to the 
September 2019 GSIL NOPD approach, DOE has simplified the lifetime 
model for GSILs in the final determination to use the average sector-
specific operating hours, as opposed to the full sector-specific 
operating hours distributions, and no longer includes the Weibull 
distribution that was intended to bring historic shipments and stock 
into alignment. DOE notes that the average lifetime of GSILs still 
somewhat exceeds the expected lifetime based solely on rated lifetime 
and average hours of use. This reflects the impact of dimming on the 
lifetime distribution for GSILs.
    To model lifetime for the CFL and LED lamp out-of-scope substitutes 
in the September 2019 GSIL NOPD, DOE used the methodology from the 
reference (``Renovation-Driven'') lifetime scenario from the March 2016 
GSL NOPR. DOE did not receive any comments objecting to the lifetime 
models for these lamps, and has continued to use the same methodology 
for the final determination.
    For a detailed discussion of the development of lamp lifetimes, see 
appendix 8C of the final determination TSD.
7. Discount Rates
    In the calculation of LCC, DOE applies discount rates appropriate 
to commercial and residential consumers to estimate the present value 
of future operating costs. DOE estimated a distribution of discount 
rates for GSILs based on cost of capital of publicly traded firms in 
the sectors that purchase GSILs.
    DOE applies weighted average discount rates calculated from 
consumer debt and asset data, rather than marginal or implicit discount 
rates. DOE notes that the LCC does not analyze the equipment purchase 
decision, so the implicit discount rate is not relevant in this model. 
The LCC estimates net present value over the lifetime of the equipment, 
so the appropriate discount rate will reflect the general opportunity 
cost of household funds, taking this time scale into account. Given the 
long time horizon modeled in the LCC, the application of a marginal 
interest rate associated with an initial source of funds would be 
inaccurate. Regardless of the method of purchase, consumers are 
expected to continue to rebalance their debt and asset holdings over 
the LCC analysis period, based on the restrictions consumers face in 
their debt payment requirements and the relative size of the interest 
rates available on debts and assets. DOE estimates the aggregate impact 
of this rebalancing using the historical distribution of debts and 
assets.
    To establish residential discount rates for the LCC analysis, DOE 
identified all relevant household debt or asset classes in order to 
approximate a consumer's opportunity cost of funds related to appliance 
energy cost savings. It estimated the average percentage shares of the 
various types of debt and equity by household income group using data 
from the Federal Reserve Board's Survey of Consumer Finances (SCF) for 
1995, 1998, 2001, 2004, 2007, 2010, 2013, and 2016.\48\ Using the SCF 
and other sources, DOE developed a distribution of rates for each type 
of debt and asset by income group to represent the rates that may apply 
in the year in which amended standards would take effect.
---------------------------------------------------------------------------

    \48\ U.S. Board of Governors of the Federal Reserve System. 
Survey of Consumer Finances. 1995, 1998, 2001, 2004, 2007, 2010, 
2013, and 2016. (Last accessed August 8, 2019.) http://www.federalreserve.gov/econresdata/scf/scfindex.htm.
---------------------------------------------------------------------------

    For commercial consumers, DOE used the cost of capital to estimate 
the present value of cash flows to be derived from a typical company 
project or investment. Most companies use both debt and equity capital 
to fund investments, so the cost of capital is the weighted-average 
cost to the firm of equity and debt financing. This corporate finance 
approach is referred to as the weighted-average cost of capital. DOE 
used currently available economic data in developing discount rates.
    IPI objected to DOE's approach to discount rates in the September 
2019 GSIL NOPD, arguing that interest rates have been falling for an 
extended period

[[Page 71655]]

of time and that DOE should not include older data in its projection of 
future discount rates. (IPI, No. 96 at p. 8) IPI encouraged DOE to test 
its payback against other reasonable discount rate assumptions. (Id.)
    Commercial discount rates are estimated as the weighted average 
cost of capital, which is calculated from four key components: Share of 
equity financing, share of debt financing, cost of equity, and cost of 
debt. Parameters of the cost of capital equation can vary substantially 
over time, and therefore the estimates can vary with the time period 
over which data are selected and the technical details of the data-
averaging method. The cost of equity is estimated using the capital 
asset pricing model (CAPM), which is a function of the risk-free rate, 
risk premium, and firm or industry beta. Federal Reserve guidance was 
used to select the historic period of data and the choice of averaging 
method. In use of CAPM, the Federal Reserve suggests capturing a forty-
year period for calculating risk premiums because it is ``sufficiently 
long to smooth cyclical fluctuations in realized returns, but short 
enough to reflect trends in required returns.'' (Federal Reserve Bank 
Services Private Sector Adjustment Factor: Docket No. OP-1229, 
Washington, DC retrieved from https://www.federalregister.gov/documents/2005/10/17/05-20660/federal-reserve-bank-services-private-sector-adjustment-factor) The method for estimating the residential 
discount rate parallels that of the commercial discount rate to the 
extent possible, and it thus aims to capture observed variations in 
household debt and asset rates over a similar historical time horizon.
    The commercial and residential discount rate estimation methods 
used in the GSIL determination maintain analytical consistency with 
those applied across rules for other appliances and equipment. The use 
of historic data provides a comparatively conservative estimate of 
benefits of standards, but it is robust to previously-observed market 
fluctuations. However, even if discount rates were decreased several 
percentage points to represent a shorter recent time frame, analytical 
results would not be substantially changed in the absence of any 
projected shipments for GSILs under a standard. And DOE notes that the 
payback period calculation does not include a discount rate. If, as the 
comment notes, risk-free rates do continue to remain low in the future, 
the rolling average of the commercial and residential discount rate 
estimation methods will incorporate these values and decrease 
accordingly.
8. Efficacy Distribution
    To accurately estimate the share of consumers that would be 
affected by a potential energy conservation standard at a particular 
TSL, DOE's LCC analysis considered the projected distribution (i.e., 
market shares) of product efficacies that consumers purchase under the 
no-new-standards case and the standards case (i.e., the case where a 
standard would be set at TSL 0.5 or TSL 1, which, as defined in this 
section, correspond to efficiency levels 0.5 and 1, respectively) in 
the assumed compliance year. The estimated market shares for the no-
new-standards case and each standards case are based on the shipments 
analysis and are shown in Table VI.11 for the LCC with substitution 
scenario. In response to the market shares projected for the 
substitution scenario in the September 2019 GSIL NOPD, a couple of 
commenters noted that while DOE stated that GSILs would be unavailable 
under a standard, DOE projected that HIR GSILs would be 3.8 percent of 
the residential market share in 2023. (IPI, No. 96 at p. 5; Rothenhaus, 
No. 16 at p. 1-2) For the final determination, in response to comments 
on HIR GSIL shipments, DOE has not projected any shipments of HIR 
GSILs, and thus the GSIL market share is 0 percent under a standard. 
This projection is also consistent with comments from industry 
indicating that manufacturers are highly unlikely to produce HIR lamps 
in a standards case. For more details on the HIR shipments, see section 
VI.F of this document. In the LCC with substitution scenario, DOE 
estimates that the GSILs that are covered by this notice would account 
for 10.8 percent of residential market share in 2023 in the absence of 
federal standards, and 0 percent of the residential market under TSL 
0.5 or TSL 1. That is, all consumers would switch from GSILs to out-of-
scope substitutes under TSL 0.5 or TSL 1. DOE notes that the market 
share of GSILs has declined in the no-new-standards case for the LCC 
with substitution scenario in this final determination due to the 
reduction in estimated average lifetime of GSILs (see section VI.E.6 of 
this document). This reduction in estimated average lifetime of GSILs 
results in a faster market transition to out-of-scope substitute lamps.

       Table VI.11--GSIL Market Share Distribution by Trial Standard Level in 2023--LCC With Substitution
----------------------------------------------------------------------------------------------------------------
                                                      EL 0  43
                                                          W      EL 0.5     EL 1      13 W    9 W  LED  Total **
                Trial Standard Level                   Halogen   39.3 W    34.3 W     CFL *    *  (%)      (%)
                                                         (%)    HIR  (%)  HIR  (%)     (%)
----------------------------------------------------------------------------------------------------------------
                                                   Residential
----------------------------------------------------------------------------------------------------------------
No-New-Standards....................................      10.8         0         0       5.6      83.6       100
TSL 0.5.............................................         0         0         0       7.9      92.1       100
TSL 1...............................................         0         0         0       7.9      92.1       100
----------------------------------------------------------------------------------------------------------------
                                                   Commercial
----------------------------------------------------------------------------------------------------------------
No-New-Standards....................................       2.7         0         0       3.1      94.2       100
TSL 0.5.............................................         0         0         0       3.3      96.7       100
TSL 1...............................................         0         0         0       3.3      96.7       100
----------------------------------------------------------------------------------------------------------------
* CFLs and LED lamps are out-of-scope consumer choice alternatives for GSILs (see section VI.B.6).
** The total may not sum to 100% due to rounding.

    Regarding the market share for GSIL lamps in the LCC GSIL-only 
(i.e., covered product) scenario, without any shipments of HIR GSILs, 
the efficacy distribution is simply that all consumers in the consumer 
sample purchase the EL 0 halogen lamp in the no-new-standards case, and 
no consumers purchase any of the GSIL lamp options under the standards 
cases. That is, the efficacy distribution considers that the 10.8% of 
consumers who purchase halogen lamps

[[Page 71656]]

would continue to make the same purchase.
    See section VI.F of this document and chapter 9 of the final 
determination TSD for further information on the derivation of the 
market efficacy distributions for the scenario with substitution.
9. LCC Savings Calculation
    DOE calculated the annualized LCC savings at TSL 0.5 and TSL 1 
based on the change in annualized LCC for the standards case compared 
to the no-new-standards case. In the covered product scenario, this 
approach models the lifecycle cost of HIR lamps under TSL 0.5 and TSL 1 
compared with the lifecycle cost of GSILs in the no-new standards case. 
In contrast, the LCC savings results in the substitution scenario also 
includes out-of-scope lamps in the efficacy distribution for both the 
standards case and the no-new standards case. That is, the LCC with 
substitution analysis also considers the upfront price and operating 
costs of out-of-scope lamps that consumers would substitute for covered 
GSILs. This approach models how consumers would substitute other lamps 
(which are more efficient and sometimes less-expensive) and is intended 
as an input into the NPV to reflect actual consumer behavior. In the 
covered product scenario, which includes only the product that would be 
directly regulated by a GSIL standard, no consumers purchase the EL 0.5 
or EL 1 HIR lamps. Although consumers would not experience actual 
savings in this scenario, DOE provides a comparison of annualized LCC 
at each EL to compare the upfront price increase to operating cost 
savings. DOE provides this analysis to illustrate the choices facing 
consumers in the EL 0.5 and EL 1 standards scenarios.
    DOE used the consumer-choice model in the shipments analysis to 
determine the fraction of consumers that purchase each lamp option 
under a standard, but the model is unable to track the purchasing 
decision for individual consumers in the LCC sample. However, DOE must 
track any difference in purchasing decision for each consumer in the 
sample in order to determine the fraction of consumers who experience a 
net cost. Therefore, DOE assumed that the rank order of consumers, in 
terms of the efficacy of the product they purchase, is the same in the 
no-new-standards case as in the standards cases. In other words, DOE 
assumed that the consumers who purchased the most-efficacious products 
in the efficacy distribution in the no-new-standards case would 
continue to do so in standards cases, and similarly, those consumers 
who purchased the least efficacious products in the efficacy 
distribution in the no-new-standards case would continue to do so in 
standards cases. This assumption is only relevant in determining the 
fraction of consumers who experience a net cost in the annualized LCC 
savings calculation, and has no effect on the estimated national impact 
of a potential standard.
10. Payback Period Analysis
    The PBP is the amount of time it takes the consumer to recover the 
additional installed cost of more-efficient products, compared to 
baseline products, through energy cost savings. PBPs are expressed in 
years. PBPs that exceed the life of the product mean that the increased 
initial installed cost is not recovered in reduced operating 
expenses.\49\
---------------------------------------------------------------------------

    \49\ The simple payback period calculation does not account for 
the additional cost of any needed replacement lamps when comparing 
lamps with different lifetimes.
---------------------------------------------------------------------------

    The inputs to the PBP calculation for each efficacy level are the 
change in total installed cost of the product and the change in the 
first-year annual operating expenditures relative to the baseline. The 
PBP calculation typically uses the same inputs as the LCC analysis, 
except that discount rates are not needed. In this document, DOE 
presents the LCC savings in the standards case for a covered product 
scenario along with an LCC with substitution scenario, the latter of 
which differs from the PBP because it includes out-of-scope lamps 
rather than only the product that would be directly regulated by a GSIL 
standard.
    EPCA, as amended, establishes a rebuttable presumption that a 
standard 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 first year's energy savings resulting from the standard, 
as calculated under the applicable test procedure. (42 U.S.C. 
6295(o)(2)(B)(iii)) For each considered efficacy level, DOE determined 
the value of the first year's energy savings by calculating the energy 
savings in accordance with the applicable DOE test procedure, and 
multiplying those savings by the average energy price projection for 
the year in which compliance with the amended standards would be 
required.

F. Shipments Analysis

    DOE uses projections of annual product shipments to calculate the 
national impacts of potential amended energy conservation standards on 
energy use, NPV, and future manufacturer cash flows.\50\ The shipments 
model takes a stock-accounting approach, tracking market shares of each 
product class and the vintage of units in the stock. Stock accounting 
uses product shipments as inputs to estimate the age distribution of 
in-service product stocks for all years. The age distribution of in-
service product stocks is a key input to calculations of both the NES 
and NPV, because lamp energy consumption and operating costs for any 
year depend on the age distribution of the stock. The shipments 
analysis also provides the efficacy distribution in the year of 
compliance which is an input to calculating LCC savings.
---------------------------------------------------------------------------

    \50\ DOE uses data on manufacturer shipments as a proxy for 
national sales, as aggregate data on sales are lacking. In general 
one would expect a close correspondence between shipments and sales.
---------------------------------------------------------------------------

    In the September 2019 GSIL NOPD, DOE modeled shipments for two 
scenarios. For the purposes of the covered product scenario LCC 
scenario, DOE ran a version of the shipments analysis where consumers 
selected between product options for the covered product at issue 
(i.e., GSILs). As an input to the NIA, DOE modeled a scenario where 
consumers selected between GSIL options and out-of-scope alternatives, 
including CFLs, LED lamps, and traditional incandescent (e.g., shatter 
resistant) lamps, because amended standards on GSILs could affect 
substitution rates.
    DOE received a number of comments on the projected shipments of HIR 
lamps during the analysis period. EEI expressed surprise that consumers 
would purchase an HIR lamp, given the higher purchase price compared to 
CFLs and LED lamps. (EEI, Public Meeting Transcript, No. 56 at pp. 57-
58) CFA found the covered-product shipments scenario unrealistic, 
expressing doubt that a large volume of consumers would behave 
irrationally by purchasing HIR lamps. (CFA, No. 76 at pp. 2-3) Lamp 
manufacturers argued that, given the market transition toward LED lamps 
and that HIR GSILs do not currently exist on the market, no 
manufacturer would undertake the upfront cost to bring such lamps to 
market and, thus, there should not be any projected shipments of HIR 
GSILs. (GE, Public Meeting Transcript, No. 56 at p. 62; NEMA, No. 88 at 
pp. 5, 8-9, 11, 14; Westinghouse, No. 112 at p. 2) DOE agrees that it 
is very unlikely that any HIR GSILs will be produced, given the 
market's overall shift toward LEDs and the information provided by 
industry manufactures, and has therefore not projected any shipments of

[[Page 71657]]

HIR GSILs in this final determination. Given that HIR GSILs were the 
only lamp options available under a standard in the covered product 
scenario, DOE has not projected shipments for this scenario. In the 
final determination, DOE projects shipments for out-of-scope 
alternative lamps.
    Additionally, DOE received comment on projected shipments of 
shatter-resistant lamps. NEMA commented that sales of shatter-resistant 
lamps are currently low and declining. (NEMA, No. 88 at p. 12) Several 
commenters noted that if sales increased to exceed a specific 
threshold, 42 U.S.C. 6295(l)(4)(H) would cause DOE to set a standard or 
trigger a backstop specific to shatter resistant lamps. (Westinghouse, 
Public Meeting Transcript, No. 56 at pp. 86-87; NEMA, No. 88 at p. 12; 
Joint Advocates, No. 113 at p. 6; State Attorneys General, No. 110 at 
p. 16) The Joint Advocates commented that the 40 watt maximum imposed 
by the backstop would limit shipments because a 40 watt shatter-
resistant incandescent lamp would be incapable of providing adequate 
levels of light for common uses. (Joint Advocates, No. 113 at p. 6) The 
State Attorneys General commented that DOE overestimated costs 
associated with a standard in the September 2019 GSIL NOPD because it 
assumed extended sales of shatter-resistant lamps. (State Attorneys 
General, No. 110 at p. 16)
    DOE acknowledges that the projected shipments of the shatter-
resistant incandescent lamps in the September 2019 GSIL NOPD were large 
enough to trigger the product-specific backstop provision, which would 
impose a maximum wattage of 40 watts and a requirement that those lamps 
be sold at retail in a package containing only one lamp. DOE also notes 
that the September 2019 GSIL NOPD did not model a significant shift to 
non-GSIL incandescent products under a standard; shipments of shatter-
resistant incandescent lamps increased by only 0.1 percent in the 
presence of a standard for GSILs as compared to the no-new-standards 
case. While traditional incandescent lamps, such as shatter-resistant 
lamps, may exist as a theoretical substitute, given the limited 
practical impact on the analytical results, DOE has removed shatter-
resistant lamps as an option for consumers in the final determination, 
as discussed in the engineering analysis (see section VI.B.6). 
Therefore DOE has not projected shipments of such lamps in its 
analysis.
1. Shipments Model
    The shipments model projects shipments of GSILs over a thirty-year 
analysis period for the no-new-standards case and for standards cases. 
Separate shipments projections are calculated for the residential 
sector and for the commercial sector. The shipments model used to 
estimate GSIL lamp shipments for this rulemaking has three main 
interacting elements: (1) A lamp demand module that estimates the 
demand for available lamp options for each year of the analysis period; 
(2) a price-learning module that projects future prices based on 
historic price trends; and (3) a market-share module that assigns 
shipments to the available lamp options.
a. Lamp Demand Module
    The lamp demand module first estimates the national demand in each 
year for GSILs and potential alternative products. The demand 
calculation assumes that sector-specific lighting capacity (maximum 
lumen output of installed lamps) remains fixed per square foot of floor 
space over the analysis period, and total floor space changes over the 
analysis period according to the EIA's AEO 2019 projections of U.S. 
residential and commercial floor space.\51\ A lamp turnover calculation 
estimates demand for new lamps in each year based on the growth of 
floor space in each year, the expected demand for replacement lamps, 
and sector-specific assumptions about the distribution of per-lamp 
lumen output desired by consumers. The demand for replacements is 
computed based on the historical shipments of lamps, the expected 
lifetimes of the lamps (in terms of total hours of operation), and 
sector-specific assumptions about lamp operating hours. In the 
September 2019 GSIL NOPD, the lamp demand module for the scenario with 
substitution also accounted for the adoption of integral LED luminaires 
into lighting applications traditionally served by GSILs and for 
consumers' transitioning between GSILs and CFLs or LED lamps both prior 
to and during the analysis period, either spontaneously or due to 
amended standards. DOE maintains this methodology for the shipments 
projections in the final determination.
---------------------------------------------------------------------------

    \51\ U.S. Energy Information Administration. Annual Energy 
Outlook 2019 with projections to 2050. 2019. Washington, DC. Report 
No. AEO2019. (Last accessed July 5, 2019.) https://www.eia.gov/outlooks/AEO/pdf/AEO2019.pdf.
---------------------------------------------------------------------------

b. Price-Learning Module
    The price-learning module estimates lamp prices in each year of the 
analysis period using a standard price-learning model,\52\ which 
relates the price of a given technology to its cumulative production, 
as represented by total cumulative shipments. Current cumulative 
shipments are determined for each lighting technology expected to 
undergo learning at the start of the analysis period and are augmented 
in each subsequent year of the analysis based on the shipments 
determined for the prior year. New prices for each technology are 
calculated from the updated cumulative shipments according to the 
learning (or experience) curve for each technology. The current year's 
shipments, in turn, affect the subsequent year's prices.
---------------------------------------------------------------------------

    \52\ Taylor, M. and S. K. Fujita. Accounting for Technological 
Change in Regulatory Impact Analyses: The Learning Curve Technique. 
2013. Lawrence Berkeley National Laboratory: Berkeley, CA. Report 
No. LBNL-6195E. (Last accessed June 23, 2015.) https://eta.lbl.gov/publications/accounting-technological-change.
---------------------------------------------------------------------------

    In the September 2019 GSIL NOPD, DOE only applied learning to lamps 
with CFL and LED technologies. DOE stated that GSILs represent a mature 
technology that has reached a stable price point due to the high volume 
of total cumulative shipments, so price learning was not considered for 
this technology. However, several stakeholders argued that price 
learning should be included for HIR GSIL lamps, specifically, as these 
lamps are not currently on the market and do not represent a mature 
technology and thus prices would decline with an increase in shipments. 
(IPI, No. 96 at p. 7; CEC, No. 102 at pp. 4-5; Joint Advocates, No. 113 
at p. 6; Rothenhaus, No. 16 at p. 1) The Joint Advocates also noted 
that DOE applied price learning to HIR IRLs in the 2015 IRL final rule. 
(Joint Advocates, No. 113 at pp. 5-6). In the final determination, DOE 
is not projecting any shipments of HIR GSILs. Without any increase in 
cumulative shipments, these is no decrease in product price due to 
price learning.
    Alternative lamps with CFL and LED technologies may continue to 
drop in price due to price learning as a result of increases in 
cumulative shipments. Because LED lamps are a relatively young 
technology, their cumulative shipments increase rapidly and hence they 
undergo a substantial price decline during the shipments analysis 
period. CFL prices, by contrast, undergo a negligible price decline, 
owing to the low shipments volume and relative maturity of this 
technology. Commenters agreed with application of

[[Page 71658]]

price learning for LED lamps, given the observed price declines and DOE 
maintained the same approach to price learning for the final 
determination. (CFA, No. 76 at p. 7; PA DEP, No. 77 at p. 2) CFA also 
commented that DOE's failure to set a standard on GSILs and would slow 
the progress of LEDs in gaining market share and diminish the extent to 
which economies of scale continue to bring down the purchase price of 
LEDs. DOE notes that the analysis reflects that the price of LED lamps 
declines slightly more slowly in the no-new-standards case compared to 
the standards cases, but that the difference in LED lamp purchase price 
is minimal.
c. Market-Share Module
    The market-share module apportions the lamp shipments in each year 
among the different lamp options developed in the engineering analysis, 
based on consumer sensitivity to various lamp features. The market-
share module assumes that, when replacing a lamp, consumers will choose 
among all of the available lamp options. Substitution matrices were 
developed to specify the product choices available to consumers. The 
available options additionally depend on the case under consideration; 
in each standards case corresponding to a TSL, only those lamp options 
at or above the particular standard level, and relevant alternative 
lamps, are considered to be available. In this way, the module assigns 
market shares to the different ELs, and consumer choice alternatives, 
based on observations of consumer preferences.
    In the September 2019 GSIL NOPD, DOE used a market-share module 
that considered purchase price, energy savings, lifetime, and mercury 
content as measured in a market study,\53\ as well as on consumer 
preferences for lighting technology as revealed in historical shipments 
data for estimating product market share in the scenario with 
substitution. DOE uses the same features in the market-share module for 
its projections in the final determination.
---------------------------------------------------------------------------

    \53\ Krull, S. and D. Freeman. Next Generation Light Bulb 
Optimization. 2012. Pacific Gas and Electric Company. (Last accessed 
December 17, 2015.) http://www.etcc-ca.com/sites/default/files/OLD/images/stories/Lighting_Conjoint_Study_v020712f.pdf.
---------------------------------------------------------------------------

    In the September 2019 GSIL NOPD, HIR GSILs, CFLs, LED lamps, and 
traditional incandescent alternatives were all available as options 
under a standard in the scenario with substitution. In the final 
determination, DOE only considers CFL and LED alternatives as potential 
substitutes for halogen GSILs in the shipments analysis. As discussed 
previously, in this final determination, DOE did not include 
traditional incandescent alternatives as a potential substitute and DOE 
assumed that manufacturers would not produce HIR GSILs in the no-new-
standards cases or under an amended standards case and therefore they 
would not be available as options to consumers in the market-share 
module.
    The market-share module incorporates a limit on the diffusion of 
LED technology into the market using the widely accepted Bass adoption 
model,\54\ the parameters of which are based on data on the market 
penetration of LED lamps published by NEMA.\55\ In this final 
determination, DOE maintains the same methodology and derived 
parameters as was used in the September 2019 GSIL NOPD.
---------------------------------------------------------------------------

    \54\ Bass, F. M. A New Product Growth Model for Consumer 
Durables. Management Science. 1969. 15(5): pp. 215-227. (Last 
accessed January 22, 2016.) http://www.jstor.org/stable/2628128?seq=1#page_scan_tab_contents.
    \55\ National Electrical Manufacturers Association. Lamp 
Indices. (Last accessed July 23, 2019.) http://www.nema.org/Intelligence/Pages/Lamp-Indices.aspx.
---------------------------------------------------------------------------

    In response to the September 2019 GSIL NOPD, there was consensus 
that the market has been transitioning to LED lamps (ASAP, Public 
Meeting Transcript, No. 56 at p. 18; NPCC, No. 58 at p. 2; NEMA, No. 88 
at p. 4; Free Market Organizations, No. 111 at p. 3; Westinghouse, No. 
112 at p. 1) and general agreement with the shipments trends for LED 
lamps, CFLs, and halogen GSILs in the analysis. (GE, No. 78 at p. 3; 
NEMA, No. 88 at p. 10, 12; Westinghouse, No. 112 at p. 2) NRDC 
commented that some consumers continue to buy incandescent lamps, due 
to slightly lower purchase prices and a tendency to purchase products 
similar to past purchases (NRDC, Public Meeting Transcript, No. 56 at 
p. 14) and ASAP commented that a GSIL standard would push more 
customers to purchase LED lamps. (ASAP, Public Meeting Transcript, No. 
56 at p. 18) DOE notes these observations and that these comments are 
consistent with DOE's analysis in the September 2019 GSIL NOPD.
    While NEMA generally agreed with DOE's projected trend of declining 
lamp shipments from 2018 to 2019 in the September 2019 GSIL NOPD, NEMA 
did not expect the decline to be quite as steep as presented in Figure 
9.4 in chapter 9 of the NOPD TSD. (NEMA, No. 88 at p. 13) DOE projects 
lamp shipments over the shipments analysis period, which begins in 
2019, using historical shipments in conjunction with estimates for lamp 
retirement functions as described in section VI.E.6 of this document. 
The projected drop in shipments is due to consumers choosing lamps with 
longer lifetimes, consistent with NEMA's lamp indices,\56\ leading to 
slower turnover in stock and fewer overall shipments of general service 
lamps. DOE also notes that historical shipments for 2018 were higher 
than shipments between the years 2015-2017 which showed consecutive 
declines in lamp shipments, making the projected drop in shipments for 
2019 appear steep relative to shipments in 2018. The drop in shipments 
for 2019 is less dramatic when factoring in the overall historical 
trend of declining lamp shipments from 2015-2017.
---------------------------------------------------------------------------

    \56\ National Electrical Manufacturers Association. Lamp 
Indices. (Last accessed July 23, 2019.) http://www.nema.org/Intelligence/Pages/Lamp-Indices.aspx.
---------------------------------------------------------------------------

    CFA commented in response to the September 2019 GSIL NOPD that the 
no-new-standard base case uses the behavior of the market with 
standards to project what market behavior would be without standards. 
(CFA, No. 76 at p. 5) DOE clarifies that the no-new-standard case 
assumes no amended standard, but does include the existing standards 
for GSILs from EISA that were phased in between 2012 and 2014.

G. National Impact Analysis

    The NIA assesses the NES and the national NPV from a national 
perspective of total consumer costs and savings that would be expected 
to result from new or amended standards at specific TSLs.\57\ 
(``Consumer'' in this context refers to consumers of the product being 
regulated and includes both residential and commercial consumers.) DOE 
calculated the NES and NPV based on projections of annual product 
shipments and prices from the shipments analysis, along with the HOU 
and energy prices from the energy use and LCC analysis.\58\ For the 
present analysis, DOE projected the energy savings, operating-cost 
savings, product costs, and NPV of consumer benefits over the lifetime 
of GSILs sold from 2023 through 2052. However, the energy savings and 
NPV of consumer benefits are not those associated with the technology 
in question for TSL 0.5 and TSL 1. Because manufacturers will not 
produce HIR lamps and consumers will not purchase them, there are no 
energy savings or benefits from transitioning

[[Page 71659]]

from the GSIL baseline to HIR technology.
---------------------------------------------------------------------------

    \57\ The NIA accounts for impacts in the 50 States and the U.S. 
territories.
    \58\ For the NIA, DOE adjusts the installed cost data from the 
LCC analysis to exclude sales tax, which is a transfer.
---------------------------------------------------------------------------

    DOE evaluates the impacts of new and amended standards by comparing 
a case without such standards against standards-case projections. The 
no-new-standards case characterizes energy use and consumer costs in 
the absence of new or amended energy conservation standards. DOE 
compares the no-new-standards case with projections characterizing the 
market if DOE adopted new or amended standards at specific TSLs. For 
the standards cases, DOE considers how a given standard would likely 
affect the market shares of products with efficacies greater than the 
standard, as well as consumer-choice alternatives. Any energy savings 
or benefits estimated in the standards case are the result of product 
shifting as consumers substitute different product types such as CFLs 
and LED lamps.
    DOE uses a spreadsheet model to calculate the energy savings and 
the national consumer costs and savings from each TSL. Interested 
parties can review DOE's analyses by changing various input quantities 
within the spreadsheet. The NIA spreadsheet model uses typical values 
(as opposed to probability distributions) as inputs.
    Table VI.12 summarizes the inputs and methods DOE used for the NIA 
analysis for the final determination. Discussion of these inputs and 
methods follows the table.

   Table VI.12--Summary of Inputs and Methods for the National Impact
                                Analysis
------------------------------------------------------------------------
            Inputs                               Method
------------------------------------------------------------------------
Shipments....................  Annual shipments for each lamp option
                                from shipments model for the no-new
                                standards case and each TSL analyzed.
Assumed compliance date of     January 1, 2023.
 standard.
No-new-standards efficacy      Estimated by the market-share module of
 distribution.                  the shipments analysis.
Standards-case efficacy        Estimated by the market-share module of
 distribution.                  the shipments analysis.
Annual energy use per unit...  Calculated for each lamp option based on
                                inputs from the Energy Use Analysis.
Total installed cost per unit  Uses lamp prices, and for the commercial
                                sector only, installation costs from the
                                LCC analysis.
Electricity prices...........  Estimated marginal electricity prices
                                from the LCC analysis.
Energy price trends..........  AEO 2019 forecasts (to 2050) and
                                extrapolation thereafter.
Annual operating cost per      Calculated for each lamp option using the
 unit.                          energy use per unit, and electricity
                                prices and trends.
Energy Site-to-Source          A time-series conversion factor based on
 Conversion.                    AEO 2019.
Discount rate................  Three and seven percent real.
Present year.................  2020.
------------------------------------------------------------------------

1. National Energy Savings
    The NES analysis involves a comparison of national energy 
consumption of the considered products in each standards case with 
consumption in the case with no new or amended energy conservation 
standards. DOE calculated the annual national energy consumption by 
multiplying the number of units (stock) of each lamp option (by vintage 
or age) by the unit energy consumption (also by vintage) for each year 
in the analysis. The NES is based on the difference in annual national 
energy consumption for the no-new-standards case and each of the 
standards cases. DOE estimated the energy consumption and savings based 
on site electricity and converted that quantity to the energy 
consumption and savings at the power plant using annual conversion 
factors derived from AEO 2019. Cumulative energy savings are the sum of 
NES for each year over the analysis period, taking into account the 
full lifetime of GSILs shipped in 2052.
    As in the September 2019 GSIL NOPD, in the final determination, DOE 
tracks both the energy consumption of GSILs and substitute out-of-scope 
lamps. Under the standards case, the lack of availability of GSIL 
options leads consumers to choose out-of-scope alternative lamps. This 
leads to a decrease in GSIL shipments that appears as a decrease in 
GSIL energy consumption, while the increase in out-of-scope shipments 
appears as an increase in energy consumption for those lamp types. DOE 
also calculated the overall energy impact of a standard including the 
increased energy consumption of out-of-scope lamps.
    DOE generally accounts for the direct rebound effect in its NES 
analyses. Direct rebound reflects the idea that as appliances become 
more efficient, consumers use more of their service because their 
operating cost is reduced. In the case of lighting, the rebound effect 
could be manifested in increased HOU or in increased lighting density 
(lamps per square foot). DOE assumed no rebound effect for GSILs in the 
September 2019 GSIL NOPD and commenters supported this assumption. (GE, 
No. 78 at p. 3; NEMA, No. 88 at p. 17; Westinghouse, No. 112 at p. 2) 
DOE maintains this assumption for the final determination.
    In response to the recommendations of a committee on ``Point-of-Use 
and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency 
Standards'' appointed by the National Academy of Sciences, DOE 
announced its intention to use FFC measures of energy use and 
greenhouse gas and other emissions in the national impact analyses and 
emissions analyses included in future energy conservation standards 
rulemakings. 76 FR 51281 (August 18, 2011). After evaluating the 
approaches discussed in the August 18, 2011 notice, DOE published a 
statement of amended policy in which DOE explained its determination 
that EIA's National Energy Modeling System (``NEMS'') is the most 
appropriate tool for its FFC analysis and its intention to use NEMS for 
that purpose. 77 FR 49701 (August 17, 2012). NEMS is a public domain, 
multi-sector, partial equilibrium model of the U.S. energy sector that 
EIA uses to prepare its AEO.\59\ The approach used for deriving FFC 
measures of energy use and emissions is described in appendix 10B of 
the final determination TSD.
---------------------------------------------------------------------------

    \59\ For more information on NEMS, refer to The National Energy 
Modeling System: An Overview, DOE/EIA-0581 (98) (Feb.1998) 
(Available at: http://www.eia.gov/oiaf/aeo/overview/).
---------------------------------------------------------------------------

    In response to the September 2019 GSIL NOPD, EEI commented that the 
site-to-primary and FFC factors used by DOE are too high and that DOE 
should anticipate that they will decline more than AEO currently 
projects. (EEI, Public Meeting Transcript, No. 56 at pp. 117-119) DOE 
acknowledges that renewable power sources are expected to account for a 
growing share of national electricity generation. Because these 
technologies do not consume fuel, the ``source'' (or ``primary'') 
energy from these sources cannot be accounted for in

[[Page 71660]]

the same manner as it is for fossil fuel sources. EIA has historically 
used a fossil fuel equivalency approach when calculating the primary 
energy associated with renewable electricity generation. As a result, 
DOE's site-to-primary conversion factors are only slightly affected by 
increase in renewable electricity and decrease in coal-fired 
generation.
2. Net Present Value Analysis
    The inputs for determining the NPV of the total costs and benefits 
experienced by consumers are: (1) Total annual increases in installed 
cost; (2) total annual savings in operating costs; and (3) a discount 
factor to calculate the present value of costs and savings. DOE 
calculates net savings each year as the difference between the no-new-
standards case and each standards case in terms of total savings in 
operating costs versus total increases in installed costs. DOE 
calculates operating-cost savings over the lifetime of each product 
shipped during the analysis period.
    The efficacy improvements from TSL 0.5 and TSL 1 do not result in 
any direct benefits from the purchase of GSIL lamps meeting those 
standards. As discussed in section VI.F of this document, manufacturers 
would not produce HIR lamps in the standards case. Manufacturers that 
have produced and attempted to sell such lamps in the recent past have 
found it uneconomic to do so. Benefits from TSL 0.5 and TSL 1 result 
from product shifting as consumers substitute more efficient out-of-
scope alternative lamps. As discussed in section VI.F.1.b of this 
document, DOE developed prices for alternative LED lamps and CFLs using 
a price-learning module incorporated in the shipments analysis.
    The operating cost savings in this document are a result of product 
shifting. The operating-cost savings are energy cost savings, which are 
calculated using the estimated energy savings in each year and the 
projected price of electricity. To estimate energy prices in future 
years, DOE multiplied the average national marginal electricity prices 
by the forecast of annual national-average residential or commercial 
electricity price changes in the Reference case from AEO 2019, which 
has an end year of 2050. To estimate price trends after 2050, DOE used 
the average annual rate of change in prices from 2035 to 2050.
    In calculating the NPV, DOE multiplies the net savings in future 
years by a discount factor to determine their present value. For the 
September 2019 GSIL NOPD, DOE estimated the NPV of consumer benefits 
using both a 3-percent and a 7-percent real discount rate. DOE uses 
these discount rates in accordance with guidance provided by the Office 
of Management and Budget (``OMB'') to federal agencies on the 
development of regulatory analysis.\60\ The discount rates for the 
determination of NPV are in contrast to the discount rates used in the 
LCC analysis, which are designed to reflect a consumer's perspective. 
The 7-percent real value is an estimate of the average before-tax rate 
of return to private capital in the U.S. economy. The 3-percent real 
value represents the ``social rate of time preference,'' which is the 
rate at which society discounts future consumption flows to their 
present value. In the September 2019 GSIL NOPD, DOE used a present year 
of 2019. For this final determination, DOE has updated the present year 
to 2020.
---------------------------------------------------------------------------

    \60\ United States Office of Management and Budget. Circular A-
4: Regulatory Analysis,'' (Sept. 17, 2003), section E (Available at: 
https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf).
---------------------------------------------------------------------------

H. Manufacturer Impact Analysis

    DOE performed an MIA to estimate the financial impacts of potential 
amended energy conservation standards on manufacturers of GSILs. DOE 
relied on the GRIM, an industry cash flow model with inputs specific to 
this rulemaking. The key GRIM inputs include data on the industry cost 
structure, unit production costs, product shipments, manufacturer 
markups, and investments in research and development (``R&D'') and 
manufacturing capital required to produce compliant products. The key 
GRIM output is INPV, which is the sum of industry annual cash flows 
over the analysis period, discounted using the industry weighted 
average cost of capital. The GRIM calculates cash flows using standard 
accounting principles and compares changes in INPV between the no-new-
standards case and the standards cases. The difference in INPV between 
the no-new-standards case and the standards cases represent the 
financial impact of the analyzed energy conservation standards on 
manufacturers. To capture the uncertainty relating to manufacturer 
pricing strategies following potential amended standards, the GRIM 
estimates a range of possible impacts under different manufacturer 
markup scenarios.
    DOE created initial estimates for the industry financial inputs 
used in the GRIM (e.g., tax rate; working capital rate; net property 
plant and equipment expenses; selling, general, and administrative 
(``SG&A'') expenses; R&D expenses; depreciation expenses; capital 
expenditures; and industry discount rate) based on publicly available 
sources, such as company filings of form 10-K from the U.S. Securities 
and Exchange Commission (``SEC'') or corporate annual reports.\61\
---------------------------------------------------------------------------

    \61\ 10-Ks are collected from the SEC's EDGAR database: https://www.sec.gov/edgar.shtml or from annual financial reports collected 
from individual company websites.
---------------------------------------------------------------------------

    The GRIM uses several factors to determine a series of annual cash 
flows starting with the announcement of potential standards and 
extending over a 30-year period following the compliance date of 
potential standards. These factors include annual expected revenues, 
costs of sales, SG&A and R&D expenses, taxes, and capital expenditures. 
In general, energy conservation standards can affect manufacturer cash 
flow in three distinct ways: (1) Creating a need for increased 
investment, (2) raising production costs per unit, and (3) altering 
revenue due to higher per-unit prices and changes in sales volumes.
    The GRIM spreadsheet uses inputs to arrive at a series of annual 
cash flows, beginning in 2020 (the reference year of the analysis) and 
continuing to 2052. DOE calculated INPVs by summing the stream of 
annual discounted cash flows during this period. DOE used a real 
discount rate of 6.1 percent for GSIL manufacturers. This initial 
discount rate estimate was derived using the capital asset pricing 
model in conjunction with publicly available information (e.g., 10-year 
treasury rates of return and company specific betas).
1. Manufacturer Production Costs
    Manufacturing more efficacious GSILs is more expensive because of 
the machinery required to coat halogen capsules and the process by 
which the capsules are coated. The changes in the manufacturer 
production costs (``MPCs'') of covered products can affect the 
revenues, gross margins, and cash flow of the industry. Typically, DOE 
develops MSPs for the covered products using reverse-engineering. 
However, because GSILs are difficult to reverse-engineer, DOE derived 
end-user prices directly in the product price determination and then 
used the end-user prices in conjunction with distribution chain markups 
to calculate the MSPs of GSILs. These end-user prices are used as an 
input to the LCC analysis and NIA. DOE updated the end-user price for 
the modeled HIR lamp in the final determination (see section VI.C). DOE 
uses this updated end-user

[[Page 71661]]

price in the MIA conducted as part of the final determination.
    To determine MPCs of GSILs from the end-user prices calculated in 
the product price determination, DOE divided the end-user prices by the 
home center markup to calculate the MSP. DOE then divided the MSP by 
the manufacturer markup to get the MPCs. DOE determined the home center 
markup to be 1.52 and the manufacturer markup to be 1.40 for all GSILs. 
Markups are further described in section VI.H.4 of this document.
2. Shipments Projections
    The GRIM estimates manufacturer revenues based on total unit 
shipment projections and the distribution of those shipments by TSL. 
Changes in sales volumes and efficacy mix over time can significantly 
affect manufacturer finances. For this analysis, the GRIM uses the 
NIA's annual shipment projections derived from the shipments analysis 
from 2020 (the reference year) to 2052 (the end year of the analysis 
period). The shipment analysis was updated for the final determination. 
DOE uses the updated shipment projections in the MIA conducted for the 
final determination. The updated shipment analysis is described in 
further detail in section VI.F of this document.
3. Product and Capital Conversion Costs
    Potential amended energy conservation standards could cause 
manufacturers to incur conversion costs to bring their production 
facilities and product designs into compliance. DOE evaluated the level 
of conversion-related expenditures that would be needed to comply with 
each considered TSL. For the MIA, DOE classified these conversion costs 
into two major groups: (1) Product conversion costs; and (2) capital 
conversion costs. Product conversion costs are investments in research, 
development, testing, marketing, and other non-capitalized costs 
necessary to make product designs comply with the analyzed energy 
conservation standards. Capital conversion costs are investments in 
property, plant, and equipment necessary to adapt or change existing 
production facilities such that new compliant product designs can be 
fabricated and assembled.
    As part of the September 2019 GSIL NOPD, DOE evaluated the level of 
capital conversion costs and product conversion costs manufacturers 
would likely incur at the analyzed TSL to manufacture the volume of 
projected HIR shipments. In response to the September 2019 GSIL NOPD, 
NEMA stated that no manufacturer would invest to produce a general 
service HIR lamp in the current market environment, now or in the 
reasonably foreseeable future, even if standards were set above 
baseline. NEMA stated that when GE and Philips brought their expensive 
HIR lamps to market, general service LED lamps had not been 
commercialized and now they are competitive in price and exceeding in 
sales compared to GSILs. Therefore, NEMA states, they would not expect 
any appreciable HIR product shipments to appear in the market in either 
the no-new-standards case or the standards cases. (NEMA, No. 88 at p. 
4-5, 9-11) Similarly, GE stated it is very unlikely that any lamp 
manufacturing business could economically justify an investment in 
manufacturing capacity for A-line lamps containing HIR filament tubes. 
The GE factory that previously made HIR filament tubes has been closed 
and the production equipment no longer exists. (GE, No. 78 at p. 3) 
NEMA further noted that over the past two years, manufacturers have 
begun withdrawing from manufacturing halogen infrared PAR lamps and 
much of what continues to be available for sale is slow-moving older 
inventory. This fact lends further credibility to the proposition that 
HIR GSILs will not be forthcoming in the event of a standard that 
requires them. (NEMA, No. 88 at p. 5) Westinghouse stated if someone 
saw an opportunity and had $8 million, such a person may attempt to 
make an HIR lamp but it was not aware of any major manufacturer 
intending to invest that kind of money in a product that people may not 
purchase. (Westinghouse, Public Meeting Transcript, No. 56 at p. 124)
    As part of this final determination, DOE updated the shipment 
analysis described in section VI.F of this document. DOE is no longer 
projecting shipments for HIR lamps in either the standards cases or the 
no-new-standards case. Therefore, for the MIA conducted for the final 
determination, DOE estimated that manufacturers would not incur any 
conversion costs in the standards cases for HIR GSILs as there are no 
shipments of those products.
4. Markup Scenarios
    To calculate the MPCs used in the GRIM, DOE divided the end-user 
prices calculated in the product price determination analysis by the 
home center markup and the manufacturer markup. DOE continued to use 
the home center markup of 1.52 that was used in the September 2019 GSIL 
NOPD.
    The manufacturer markup accounts for the non-production costs 
(i.e., SG&A, R&D, and interest) along with profit. Modifying these 
markups in the standards cases yields different sets of impacts on 
manufacturers. For the MIA, DOE modeled two standards-case markup 
scenarios to represent uncertainty regarding the potential impacts on 
prices and profitability for manufacturers following the implementation 
of amended energy conservation standards: (1) A preservation of gross 
margin percentage markup scenario; and (2) a technology specific markup 
scenario. These scenarios lead to different markup values that, when 
applied to the MPCs, result in varying revenue and cash flow impacts.
    Under the preservation of gross margin percentage scenario, DOE 
applied a single uniform ``gross margin percentage'' markup of 1.40 
across all analyzed lamps, which assumes that manufacturers would be 
able to maintain the same amount of profit as a percentage of revenues 
at all lamps analyzed. This markup scenario is identical to the one 
used in the September 2019 GSIL NOPD.
    Under the technology specific markup scenario, DOE assumed that 
incandescent lamps, CFLs, and LED lamps have different manufacturer 
markups. As sales of lamp technologies that are no longer able to meet 
the analyzed energy conservation standards are no longer sold, the 
average manufacturer markup is reduced. DOE slightly altered the 
technology specific markups in the final determination due to the 
changes in the shipment analysis. For the final determination DOE 
estimated an incandescent lamp manufacturer markup of approximately 
1.532, a CFL manufacturer markup of approximately 1.459, and an LED 
lamp manufacturer markup of approximately 1.386. In the no-new-
standards case these technology specific manufacturer markups produce 
an identical INPV as in the preservation of gross margin markup 
scenario.
    A comparison of industry financial impacts under the two markup 
scenarios is presented in section VII.D.1 of this document.

VII. Analytical Results and Conclusions

A. Trial Standard Levels

    DOE analyzed the benefits and burdens of two TSLs for GSILs. TSL 
0.5 is a new TSL analyzed in the final determination and is composed of 
EL 0.5, which is modeled on lamps with a 3,000 hour life. TSL 1, which 
was included in the September 2019 NOPD,

[[Page 71662]]

is composed of EL 1 and is the max-tech EL for GSILs. Analyses were 
conducted as described in section VI for each TSL. Table VII.1 presents 
the TSLs and the corresponding efficacy levels that DOE has identified 
for potential amended energy conservation standards for GSILs.

                                  Table VII.1--Trial Standard Levels for GSILs
----------------------------------------------------------------------------------------------------------------
                                                     Technology required to
              TSL                        EL           comply with standard               Description
----------------------------------------------------------------------------------------------------------------
TSL 0..........................  EL 0..............  Halogen...............  No new GSIL standard.
TSL 0.5........................  EL 0.5............  HIR (3,000 hour lamp).  HIR standard in 2023.
TSL 1..........................  EL 1..............  HIR (1,000 hour lamp).  HIR standard in 2023.
----------------------------------------------------------------------------------------------------------------

B. Economic Impacts on Individual Consumers

    DOE analyzed the cost effectiveness (i.e., the savings in operating 
costs compared to any increase in purchase price likely to result from 
the imposition of a standard) by considering the LCC and PBP. DOE 
presents the LCC of the covered product (i.e., GSILs) and also presents 
a second LCC, which is used as an input for the NPV, which goes beyond 
GSILs and also accounts for the purchase price and operating costs of 
out-of-scope substitute lamps (``LCC with substitution''). These 
analyses are discussed in the following sections.
1. Life-Cycle Cost and Payback Period
    In general, higher-efficiency products can affect consumers in two 
ways: (1) Purchase price increases and (2) annual operating cost 
decreases. Inputs used for calculating the annualized LCC and PBP 
include total installed costs (i.e., product price plus installation 
costs) and operating costs (i.e., annual energy use, energy prices, 
energy price trends, repair costs, and maintenance costs). The 
annualized LCC calculation also uses product lifetime and a discount 
rate.
    Table VII.2 shows the average annualized LCC and PBP results for 
the ELs considered for GSILs in this analysis. For both the residential 
and commercial sector, the payback period for HIR lamps is 
approximately four times longer than the product life.
    Projected shipments are typically used as an input to calculate LCC 
savings. In this case, because DOE projects zero shipments of the 
covered product in a standards scenario, DOE compares the upfront price 
increase to operating cost savings to examine the annualized LCC at 
each EL. The annualized LCC at EL 0.5 in the residential sector is 
$6.83 compared to $6.28 at the baseline, representing a cost increase 
of $0.55. The annualized LCC at EL 0.5 in the commercial sector is 
$27.14 compared to $28.44 at the baseline, a savings of $1.30. The 
annualized LCC at EL 1 in the residential sector is $10.77 compared to 
$6.28 at the baseline, a cost increase of $4.49. The annualized LCC at 
EL 1 in the commercial sector is $52.13 compared to $28.44 at the 
baseline, a cost increase of $23.69. DOE provides this analysis to 
illustrate the choices facing consumers in the EL 0.5 and EL 1 
standards case.
    Table VII.3 shows the average annualized LCC savings for TSL 0.5 
and TSL 1 under the substitution scenario. No consumers are anticipated 
to buy HIR technology in the standards case. Instead, these numbers 
reflect the result of a substitution effect as consumers substitute 
out-of-scope lamps for GSILs that are no longer available, yielding a 
reduction in operating costs relative to the no-new-standards case.

                                          Table VII.2--Average Annualized LCC and PBP Results by Efficacy Level
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Average costs (2018$)
                 ------------------------------------------------------------------------------------------------------                      Average
       EL                                                               Annualized                                      Simple  payback      lifetime
                   Installed cost     Annualized     First  year's       lifetime      Annualized LCC     Change in         (years)          (years)
                                    installed cost   operating cost   operating cost                    annualized LCC
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Residential Sector
--------------------------------------------------------------------------------------------------------------------------------------------------------
             0             1.94             1.57             4.51             4.71             6.28    ...............  ...............            1.5
           0.5             8.67             2.47             4.12             4.36             6.83           (0.55)             17.3              4.5
             1             8.67             7.02             3.60             3.76            10.77           (4.49)              7.4              1.5
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    Commercial Sector
--------------------------------------------------------------------------------------------------------------------------------------------------------
             0             3.48            13.77            13.55            14.67            28.44    ...............  ...............            0.4
           0.5            10.21            13.71            12.38            13.43            27.14             1.30              5.8              1.3
             1            10.21            40.43            10.81            11.70            52.13          (23.69)              2.5              0.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each EL are calculated assuming that all consumers use products at that EL. The PBP is measured relative to the baseline product
  and does not account for the additional cost of any needed replacement lamps when comparing lamps with different lifetimes.


[[Page 71663]]


       Table VII.3--Average Annualized LCC Savings Results by Trial Standard Level--LCC With Substitution
----------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost savings
                                                   -------------------------------------------------------------
           TSL                       EL                Average annualized  LCC       Percent of  consumers that
                                                          savings *  (2018$)            experience net cost
----------------------------------------------------------------------------------------------------------------
                                               Residential Sector
----------------------------------------------------------------------------------------------------------------
                0.5                       0.5                           3.27                            0.0
                  1                         1                           3.27                            0.0
----------------------------------------------------------------------------------------------------------------
                                                Commercial Sector
----------------------------------------------------------------------------------------------------------------
                0.5                       0.5                          12.75                            0.0
                  1                         1                          12.76                            0.0
----------------------------------------------------------------------------------------------------------------
* The savings represent the average annualized LCC savings for affected consumers.

    The cost of HIR lamps cannot be recovered during their lifetime. 
Consumers are unlikely to buy HIR technology in the standards case, 
assuming manufacturers would even produce the product given the upfront 
cost to bring such lamps to market. Instead, any potential savings 
reflect the result of a substitution effect as consumers are priced out 
of the market for GSILs. That is, TSL 0.5 and TSL 1 are anticipated to 
increase the cost of GSILs by 346 percent relative to a no-standards 
case. This drives some consumers to shift toward out-of-scope 
alternative lamps, yielding a reduction in operating costs relative to 
the base case. Additionally, the annualized LCC would be $0.55 higher 
at EL 0.5 and $4.49 higher at EL 1 for residential consumers, meaning 
that HIR lamps would impose a net cost on affected consumers. However, 
because no consumers purchase the EL 0.5 and EL 1 HIR lamps, DOE is 
unable to provide an estimate for the proportion of consumers who would 
bear a net cost in the standards case.
    An individual commented in response to the September 2019 GSIL NOPD 
that an LCC subgroup analysis should also be conducted. (Vondrasek, No. 
101 at p. 5) DOE notes that in the context of a proposed or final rule, 
DOE considers LCC subgroup analysis for subgroups which may be 
disproportionately affected, such as low-income consumers or small 
businesses, to determine whether a standard would still be economically 
justified for these subgroups. However, in the context of a proposed or 
final determination, if the analytical results for the full consumer 
sample indicate that a standard would not be economically justified, it 
is unnecessary to consider how the analytical results might differ for 
a subgroup of that sample, as DOE would not set a standard that is not 
economically justified for the full sample.
2. Rebuttable Presumption Payback
    As discussed in section VI.E.9 of this document, EPCA establishes a 
rebuttable presumption that an energy conservation standard is 
economically justified if the increased purchase 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. In calculating a 
rebuttable presumption PBP for each of the considered ELs, DOE used 
discrete values, and, as required by EPCA, based the energy use 
calculation on the DOE test procedure for GSILs. In contrast, the PBPs 
presented in section VII.B.1 of this section were calculated using 
distributions that reflect the range of energy use in the field. See 
chapter 8 of the final determination TSD for more information on the 
rebuttable presumption payback analysis. Regardless of whether the 
rebuttable presumption PBP had been met, 42 U.S.C. 6295(o)(4) would 
prevent DOE from setting standards at that level.

C. National Impact Analysis

    This section presents DOE's estimates of the NES and the NPV of 
consumer benefits that would result from each of the considered TSLs as 
potential amended standards.
1. Energy Savings
    To estimate the energy savings attributable to potential amended 
standards for GSILs, DOE compared consumer energy consumption under the 
no-new-standards case to consumer anticipated energy consumption under 
each TSL. The savings are measured over the entire lifetime of products 
purchased in the 30-year period that begins in the year of anticipated 
compliance with amended standards (2023-2052). Table VII.4 presents 
DOE's projections of the NES for each TSL considered for GSILs, as well 
as considered GSIL alternatives. The savings were calculated using the 
approach described in section VI.G of this document. In addition to 
GSIL energy savings, Table VII.4 illustrates the increased energy 
consumption of consumers who transition to out-of-scope CFL and LED 
lamp alternatives, because more consumers purchase these lamps at TSL 
0.5 and TSL 1 relative to the no-new-standards case. At both TSLs the 
impact of a standard is the same, as DOE anticipates that manufacturers 
will not produce HIR lamps under an amended GSIL standard and that 
consumers will only purchase CFL and LED lamp out-of-scope options. DOE 
notes that the reduction in energy savings in the final determination 
compared to the September 2019 GSIL NOPD is a result of the shorter 
lifetime for halogen GSILs, which results in a faster market transition 
to more efficient out-of-scope lamps in the no-new-standards case.

   Table VII.4--Cumulative National Energy Savings for GSILs and GSIL
                   Alternatives; 30 Years of Shipments
                               [2023-2052]
------------------------------------------------------------------------
                                              TSL 0.5          TSL 1
------------------------------------------------------------------------
Site energy savings (quads):
    GSILs...............................           0.197           0.197

[[Page 71664]]

 
    CFL alternatives....................         (0.006)         (0.006)
    LED alternatives....................         (0.036)         (0.036)
                                         -------------------------------
        Total...........................           0.155           0.155
                                         -------------------------------
Source Energy Savings (quads):
    GSILs...............................           0.532           0.532
    CFL alternatives....................         (0.016)         (0.016)
    LED alternatives....................         (0.098)         (0.098)
                                         -------------------------------
        Total...........................           0.419           0.419
                                         -------------------------------
FFC Energy Savings (quads):
    GSILs...............................           0.557           0.557
    CFL alternatives....................         (0.016)         (0.016)
    LED alternatives....................         (0.102)         (0.102)
                                         -------------------------------
        Total...........................           0.438           0.438
------------------------------------------------------------------------

    OMB Circular A-4 \62\ requires agencies to present analytical 
results, including separate schedules of the monetized benefits and 
costs that show the type and timing of benefits and costs. Circular A-4 
also directs agencies to consider the variability of key elements 
underlying the estimates of benefits and costs. For this final 
determination, DOE undertook a sensitivity analysis using 9 years, 
rather than 30 years, of product shipments. The choice of a 9-year 
period is a proxy for the timeline in EPCA for the review of certain 
energy conservation standards and potential revision of and compliance 
with such revised standards.\63\ The review timeframe established in 
EPCA is generally not synchronized with the product lifetime, product 
manufacturing cycles, or other factors specific to GSILs. Thus, such 
results are presented for informational purposes only and are not 
indicative of any change in DOE's analytical methodology. The NES 
sensitivity analysis results based on a 9-year analytical period are 
presented in Table VII.5 of this document. The impacts are counted over 
the lifetime of GSILs purchased in 2023-2031.
---------------------------------------------------------------------------

    \62\ U.S. Office of Management and Budget. Circular A-4: 
Regulatory Analysis. September 17, 2003. Available at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf.
    \63\ Section 325(m) of EPCA requires DOE to review its standards 
at least once every 6 years, and requires, for certain products, a 
3-year period after any new standard is promulgated before 
compliance is required, except that in no case may any new standards 
be required within 6 years of the compliance date of the previous 
standards. If DOE makes a determination that amended standards are 
not needed, it must conduct a subsequent review within three years 
following such a determination. As DOE is evaluating the need to 
amend the standards, the sensitivity analysis is based on the review 
timeframe associated with amended standards. While adding a 6-year 
review to the 3-year compliance period adds up to 9 years, DOE notes 
that it may undertake reviews at any time within the 6-year period 
and that the 3-year compliance date may yield to the 6-year 
backstop. A 9-year analysis period may not be appropriate given the 
variability that occurs in the timing of standards reviews and the 
fact that for some products, the compliance period is 5 years rather 
than 3 years.

   Table VII.5--Cumulative National Energy Savings for GSILs and GSIL
                   Alternatives; 9 Years of Shipments
                               [2023-2031]
------------------------------------------------------------------------
                                              TSL 0.5          TSL 1
------------------------------------------------------------------------
Site Energy Savings (quads):
    GSILs...............................           0.061           0.061
    CFL alternatives....................         (0.005)         (0.005)
    LED alternatives....................         (0.009)         (0.009)
                                         -------------------------------
        Total...........................           0.047           0.047
                                         -------------------------------
Source Energy Savings (quads):
    GSILs...............................           0.166           0.166
    CFL alternatives....................         (0.013)         (0.013)
    LED alternatives....................         (0.024)         (0.024)
                                         -------------------------------
        Total...........................           0.129           0.129
                                         -------------------------------
FFC Energy Savings (quads):
    GSILs...............................           0.174           0.174
    CFL alternatives....................         (0.014)         (0.014)
    LED alternatives....................         (0.025)         (0.025)
                                         -------------------------------
        Total...........................           0.136           0.136
------------------------------------------------------------------------


[[Page 71665]]

2. Net Present Value of Consumer Costs and Benefits
    DOE estimated the cumulative NPV of the total costs and savings for 
consumers that would result from the considered TSLs for GSILs. 
However, as described previously, the benefits of the considered TSLs 
do not come from improved efficiency for the product for which DOE is 
making a determination whether existing standards should be amended. 
Rather, because manufacturers will not produce HIR lamps in the 
standard case, any benefit from an amended standard is the result of 
consumers shifting to out-of-scope alternatives. In accordance with 
OMB's guidelines on regulatory analysis,\64\ DOE calculated NPV using 
both a 7-percent and a 3-percent real discount rate. Table VII.6 shows 
the consumer NPV results with impacts counted over the lifetime of 
GSILs purchased in 2023-2052.
---------------------------------------------------------------------------

    \64\ U.S. Office of Management and Budget. Circular A-4: 
Regulatory Analysis. September 17, 2003. Available at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf.

   Table VII.6--Cumulative Net Present Value of Quantifiable Consumer
     Benefits for GSILs and GSIL Alternatives; 30 Years of Shipments
                               [2023-2052]
------------------------------------------------------------------------
                                              TSL 0.5          TSL 1
------------------------------------------------------------------------
3 percent (billions 2018$):
    GSILs...............................           5.539           5.539
    CFL alternatives....................         (0.192)         (0.192)
    LED alternatives....................         (0.969)         (0.969)
                                         -------------------------------
        Total...........................           4.378           4.378
                                         -------------------------------
7 percent (billions 2018$):
    GSILs...............................           3.217           3.217
    CFL alternatives....................         (0.133)         (0.133)
    LED alternatives....................         (0.566)         (0.566)
                                         -------------------------------
        Total...........................           2.518           2.518
------------------------------------------------------------------------

    The NPV results based on the aforementioned 9-year analytical 
period are presented in Table VII.7 of this document. The impacts are 
counted over the lifetime of products purchased in 2023-2031. As 
mentioned previously, such results are presented for informational 
purposes only and are not indicative of any change in DOE's analytical 
methodology or decision criteria.

   Table VII.7--Cumulative Net Present Value of Quantifiable Consumer
      Benefits for GSIL and GSIL Alternatives; 9 Years of Shipments
                               [2023-2031]
------------------------------------------------------------------------
                                              TSL 0.5          TSL 1
------------------------------------------------------------------------
3 percent (billions 2018$):
    GSILs...............................           2.184           2.184
    CFL alternatives....................         (0.168)         (0.168)
    LED alternatives....................         (0.353)         (0.353)
                                         -------------------------------
        Total...........................           1.663           1.663
                                         -------------------------------
7 percent (billions 2018$):.............
    GSILs...............................           1.675           1.675
    CFL alternatives....................         (0.121)         (0.121)
    LED alternatives....................         (0.285)         (0.285)
                                         -------------------------------
        Total...........................           1.268           1.268
------------------------------------------------------------------------

    DOE recognizes that the current quantifiable framework does not 
represent the full welfare effects of this shift in consumer purchase 
decisions due to an energy conservation standard. In the 2015 IRL final 
rule, DOE ``committed to developing a framework that can support 
empirical quantitative tools for improved assessment of the consumer 
welfare impacts of appliance standards.'' (80 FR 4141) DOE remains 
committed to this goal and to enhancing the methodology the Department 
uses to represent and quantify the consumer welfare impacts of its 
standards.

D. Economic Impacts on Manufacturers

    DOE performed a manufacturer impact analysis (``MIA'') to estimate 
the impact of analyzed energy conservation standards on manufacturers 
of GSILs. The following section describes the expected impacts on GSIL 
manufacturers at each considered TSL. Chapter 11 of the final 
determination TSD explains the analysis in further detail.
1. Industry Cash Flow Analysis Results
    In this section, DOE provides results from the Government 
Regulatory Impact Model (``GRIM''), which examines changes in the 
industry that would result from the analyzed standard. Table VII.8 and 
Table VII.9 illustrate the estimated financial impacts (represented

[[Page 71666]]

by changes in INPV) of potential amended energy conservation standards 
on manufacturers of GSILs, as well as the conversion costs that DOE 
estimates manufacturers of GSILs would incur at the analyzed TSLs.
    To evaluate the range of cash-flow impacts on the GSIL industry, 
DOE modeled two manufacturer markup scenarios that correspond to the 
range of anticipated market responses to potential standards. Each 
markup scenario results in a unique set of cash flows and corresponding 
industry values at the analyzed TSLs. In the following discussion, the 
INPV results refer to the difference in industry value between the no-
new-standards case and the standards cases that result from the sum of 
discounted cash flows from the reference year (2020) through the end of 
the analysis period (2052).
    DOE modeled a preservation of gross margin markup scenario. This 
scenario assumes that in the standards cases, manufacturers would be 
able to pass along all the higher production costs required for more 
efficacious products to their consumers. DOE also modeled a technology 
specific markup scenario. In the technology specific markup scenario, 
different lamp technologies (incandescent, CFL, LED) have different 
manufacturer markups.
    Table VII.8 and Table VII.9 present the results of the industry 
cash flow analysis for GSIL manufacturers under the preservation of 
gross margin and the technology specific markup scenarios.

        Table VII.8--Manufacturer Impact Analysis for GSILs--Preservation of Gross Margin Markup Scenario
----------------------------------------------------------------------------------------------------------------
                                                               No-new- standards
                                               Units                  case            TSL 0.5          TSL 1
----------------------------------------------------------------------------------------------------------------
INPV................................  2018$ millions.........             298.3            292.4           292.4
Change in INPV......................  2018$ millions.........  .................           (5.9)           (5.9)
                                      %......................  .................           (2.0)           (2.0)
Product Conversion Costs............  2018$ millions.........  .................  ..............  ..............
Capital Conversion Costs............  2018$ millions.........  .................  ..............  ..............
Total Conversion Costs..............  2018$ millions.........  .................  ..............  ..............
----------------------------------------------------------------------------------------------------------------


            Table VII.9--Manufacturer Impact Analysis for GSILs--Technology Specific Markup Scenario
----------------------------------------------------------------------------------------------------------------
                                                               No-new- standards
                                               Units                  case            TSL 0.5          TSL 1
----------------------------------------------------------------------------------------------------------------
INPV................................  2018$ millions.........             298.3            270.9           270.9
Change in INPV......................  2018$ millions.........  .................      \*\ (27.5)      \*\ (27.5)
                                      %......................  .................           (9.2)           (9.2)
Product Conversion Costs............  2018$ millions.........  .................  ..............  ..............
Capital Conversion Costs............  2018$ millions.........  .................  ..............  ..............
Total Conversion Costs..............  2018$ millions.........  .................  ..............  ..............
----------------------------------------------------------------------------------------------------------------
* Values do not add exactly due to rounding.

    At TSL 0.5 and at TSL 1, DOE estimates that impacts on INPV will 
range from -$27.5 million to -$5.9 million, or a change in INPV of -9.2 
to -2.0 percent. At TSL 0.5 and at TSL 1, there is no change in free 
cash-flow from the no-new-standards case since manufacturers do not 
have any conversion costs. Therefore, free cash-flow remains at $31.7 
million in 2022, the year leading up to the potential standard, which 
is the same value as in the no-new-standards case.
    At TSL 0.5 and TSL 1, the change in shipment-weighted average MPC 
in 2023 increases 2.7 percent. However, lighting manufacturers sell 
approximately 19 million fewer units annually after 2023 because most 
consumers purchase longer lifetime products. This decrease in sales 
volume outweighs the small increase in average MPC causing INPV to 
decrease in both markup scenarios.
2. Direct Impacts on Employment
    DOE typically presents quantitative estimates of the potential 
changes in production employment that could result from the analyzed 
energy conservation standards. However, all production facilities that 
once produced GSILs in the U.S. have either closed or are scheduled to 
close prior to 2023, the estimated compliance year of the analysis. 
Therefore, DOE assumed there will not be any domestic employment for 
GSIL production after 2023, and that none of the analyzed standards 
would impact domestic GSIL production employment. While there is 
limited CFL and LED lamp production in the U.S., DOE also does not 
assume that any CFL or LED lamp domestic production employment would be 
impacted by the analyzed standards. Therefore, the final determination 
would not have a significant impact on domestic employment in the GSIL 
industry.
    Several individuals, some through a form letter process, stated 
that DOE's proposed determination would put thousands of manufacturing 
jobs at risk. (Coconut Moon, No. 35 at p. 1; Goldman, No. 36 at p. 1; 
LeRoy, No. 40 at p. 1; Meadow, No. 41 at p. 1; Caswell, No. 44 at p. 1; 
H, No. 47 at p. 1; Kodama, No. 49 at p. 1; Dashe, No. 61 at p. 1; 
Werner, No. 37 at p. 1; Datz, No. 39 at p. 1; Kodama, No. 48 at p. 1; 
Anonymous, No. 98 at p. 16) DOE assumes the analyzed energy 
conservation standards would not impact GSIL domestic production, as 
none exists. Additionally, DOE assumes the final determination would 
not decrease the limited CFL and LED lamp domestic production, as those 
lamps would continue to be sold in the U.S. Therefore, DOE does not 
believe that any jobs related to the manufacturing of GSILs, CFLs, or 
LED lamps are at risk due to this final determination.
3. Impacts on Manufacturing Capacity
    DOE does not anticipate any significant capacity constraints at the 
analyzed energy conservation standards. As previously discussed in 
section VI.F, DOE did not estimate any HIR lamp sales (EL 0.5 and EL 1) 
in either the no-new-standards case or in the standards cases. 
Therefore, manufacturers would not need to purchase machines used to 
coat halogen capsules. Additionally, manufacturers would not need to 
add capacity for either CFLs or LED lamps in the standards cases as 
there would already be excess production capacity for those lamps in 
the analyzed

[[Page 71667]]

compliance year since DOE estimates higher production volumes of both 
of those lamps in the years leading up to the compliance date of the 
analyzed standards.
4. Impacts on Subgroups of Manufacturers
    Using average cost assumptions to develop an industry cash-flow 
estimate may not be adequate for assessing differential impacts among 
manufacturer subgroups. Small manufacturers, niche equipment 
manufacturers, and manufacturers exhibiting cost structures 
substantially different from the industry average could be affected 
disproportionately. DOE identified one manufacturer subgroup for GSILs, 
small manufacturers.
    For the small business subgroup analysis, DOE applied the small 
business size standards published by the Small Business Administration 
(``SBA'') to determine whether a company is considered a small 
business. The size standards are codified at 13 CFR part 121. To be 
categorized as a small business under NAICS code 335110, ``electric 
lamp bulb and part manufacturing,'' a GSIL manufacturer and its 
affiliates may employ a maximum of 1,250 employees. The 1,250-employee 
threshold includes all employees in a business's parent company and any 
other subsidiaries. The small business subgroup analysis is discussed 
in section VIII.C of this document.
5. Cumulative Regulatory Burden
    One aspect of assessing manufacturer burden involves looking at the 
cumulative impact of multiple DOE standards and the regulatory actions 
of other Federal agencies and States that affect the manufacturers of a 
covered product. While any one regulation may not impose a significant 
burden on manufacturers, the combined effects of several existing or 
impending regulations may have serious consequences for some 
manufacturers, groups of manufacturers, or an entire industry. 
Assessing the impact of a single regulation may overlook this 
cumulative regulatory burden. In addition to energy conservation 
standards, other regulations can significantly affect manufacturers' 
financial operations. Multiple regulations affecting the same 
manufacturer can strain profits and lead companies to abandon product 
lines or markets with lower expected future returns than competing 
products. For these reasons, DOE typically conducts an analysis of 
cumulative regulatory burden as part of its rulemakings pertaining to 
appliance efficiency. However, given the conclusion discussed in 
section VII.E of this document, DOE did not conduct a cumulative 
regulatory burden analysis.

E. Conclusion

    When considering amended energy conservation standards, the 
standards that DOE adopts for any type (or class) of covered product 
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)) In determining 
whether a standard is economically justified, the Secretary must 
determine whether the benefits of the standard exceed its burdens by, 
to the greatest extent practicable, considering the seven statutory 
factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i)) The new or 
amended standard must also result in significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B))
    For this final determination, DOE considered the impacts of amended 
standards for GSILs at analyzed TSLs, beginning with the maximum 
technologically feasible level, to determine whether that level was 
economically justified. Where the max-tech level was not justified, DOE 
then considered the next most efficient level and undertook the same 
evaluation. Because an analysis of potential economic justification and 
energy savings first requires an evaluation of the relevant technology, 
in the following sections DOE first discusses the technological 
feasibility of amended standards. DOE then addresses the energy savings 
and economic justification associated with potential amended standards.
1. Technological Feasibility
    EPCA mandates that DOE consider whether amended energy conservation 
standards for GSILs would be technologically feasible. (42 U.S.C. 
6295(o)(2)(A)) DOE has determined that there are design options that 
would improve the efficacy of GSILs. These design options are being 
used in similar products (IRLs) that are commercially available and 
have been used in commercially available GSILs in the past and 
therefore are technologically feasible. Hence, DOE has determined that 
amended energy conservation standards for GSILs are technologically 
feasible.
2. Significant Conservation of Energy
    EPCA also mandates that DOE consider whether amended energy 
conservation standards for GSILs would result in significant 
conservation of energy. (42 U.S.C. 6295(o)(3)(B)) As stated in section 
III.D.2, DOE has not finalized updates to the Process Rule, in which 
DOE considers how to determine whether a new or amended standard would 
result in significant energy savings. As this rule is not yet 
finalized, DOE is not relying on that proposed threshold for this 
determination. However, DOE is still required by statute to issue only 
such standards as will save a significant amount of energy. (42 U.S.C. 
6295(o)(3)(B))
    As described previously, there are no energy savings or benefits 
from transitioning to HIR technology. HIR lamps would burden consumers 
with net costs, because the installed cost of the technology is too 
high to recoup via energy savings. As a result, any energy savings that 
might result from establishing a standard at TSL 0.5 or TSL 1 are the 
result of product shifting as consumers abandon HIR GSIL products in 
favor of different product types having different performance 
characteristics and features. DOE notes that EPCA prohibits DOE from 
prescribing an amended or new standard if that standard is likely to 
result in the unavailability in the United States in any covered 
product type (or class) of performance characteristics (including 
reliability), features, sizes, capacities, and volumes that are 
substantially the same as those generally available in the United 
States at the time of the Secretary's finding. 42 U.S.C. 6295(o)(4)
3. Economic Justification
    In determining whether a standard is economically justified, the 
Secretary must determine whether the benefits of the standard exceed 
its burdens, considering to the greatest extent practicable the seven 
statutory factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i)) 
One of those seven factors is the savings in operating costs throughout 
the estimated average life of the covered 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 standard. This factor is assessed using life cycle cost and 
payback period analysis, discussed in section III.E.1.b of this 
section.
    Given the high upfront cost and long payback period, these analyses 
do not anticipate that consumers will benefit from the introduction of 
HIR lamp technology. Additionally, the recent experiences of two 
manufacturers that attempted and failed to market such

[[Page 71668]]

products illustrates that they are not commercially viable. At TSL 0.5 
and TSL 1, manufacturers would not spend the capital required to 
produce HIR lamps given the low probability of recovering those costs 
as consumers substitute less costly non-GSIL products. Manufacturers 
would instead choose to forego the investment and produce other 
lighting products or exit the market entirely.
    After considering the analysis and weighing the benefits and the 
burdens, DOE concluded that, at TSL 1 for GSILs, the benefits of energy 
savings and positive NPV of consumer benefits would be outweighed by 
the fact that the covered product PBP exceeds covered product lifetime 
by nearly a factor of five in the residential sector and more than a 
factor of six in the commercial sector. Further, HIR products at EL 1 
represent an additional annualized life cycle cost of $4.49 in the 
residential sector and $23.69 in the commercial sector relative to the 
baseline GSIL. The simple payback period is 7.4 years (compared to an 
average lifetime of 1.5 years) in the residential sector and 2.5 years 
(compared to an average lifetime of 0.4 years) in the commercial 
sector. At TSL 1, DOE estimates that INPV will decrease between $27.5 
million to $5.9 million, or a decrease in INPV of 9.2 to 2.0 percent. 
Based on the second EPCA factor that DOE is required to evaluate, DOE 
has concluded that imposition of a standard at TSL 1 is not 
economically justified because the operating cost savings of the 
covered product are insufficient to recover the upfront cost. Based on 
these considerations, DOE is not amending energy conservation standards 
to adopt TSL 1 for GSILs.
    DOE has presented additional consumer choice analysis anticipating 
that if it were to establish a standard at TSL 1, consumers would 
substitute other available products, such as LED lamps and CFLs (the 
substitution scenario). DOE then estimated the NPV of the total costs 
and benefits experienced by the Nation in this scenario. DOE also 
conducted an MIA to estimate the impact of amended energy conservation 
standards on manufacturers of GSILs in this consumer choice scenario. 
Under the consumer choice analysis, the NPV of consumer benefits at TSL 
1 would be $2.518 billion using a discount rate of 7 percent, and 
$4.378 billion using a discount rate of 3 percent. However, this NPV is 
based on the anticipated lifecycle cost savings to consumers who 
substitute other lamps due to the unavailability of GSILs. As explained 
elsewhere in this document, EPCA requires DOE to compare the savings in 
operating costs of the covered product compared to any cost increase of 
the covered products which are likely to result from the imposition of 
the standard. (42 U.S.C. 6295(o)(2)(B)(i)(II)) Although the NPV is 
projected based on shipments of out-of-scope lamps, DOE's consideration 
of life cycle costs is limited to the covered product examined here--
that is, GSILs. As discussed in section V.C. of this final rule, EPCA 
prohibits DOE from prescribing an amended or new standard if that the 
standard is likely to result in the unavailability in the United States 
in any covered product type (or class) of performance characteristics 
(including reliability), features, sizes, capacities, and volumes that 
are substantially the same as those generally available in the United 
States at the time of the Secretary's finding. In addition to being 
economically unjustified, amended standards for GSILs would force the 
unavailability of a product type, performance characteristic or feature 
in contravention of EPCA.
    After considering the analysis and weighing the benefits and the 
burdens, DOE concluded that, at TSL 0.5 for GSILs, the benefits of 
energy savings and positive NPV of consumer benefits would be 
outweighed by the fact that the covered product PBP exceeds covered 
product lifetime by nearly a factor of four in the residential sector 
and more than a factor of four in the commercial sector. At EL 0.5, the 
annualized covered product LCC is an additional $0.55 in the 
residential sector and a decrease of $1.30 in the commercial sector 
relative to the baseline GSIL. The simple payback period is 17.3 years 
(compared to an average lifetime of 4.5 years) in the residential 
sector and 5.8 years (compared to an average lifetime of 1.3 years) in 
the commercial sector. At TSL 0.5, DOE estimates that INPV will 
decrease between $27.5 million to $5.9 million, or a decrease in INPV 
of 9.2 to 2.0 percent. Based on the second EPCA factor that DOE is 
required to evaluate, DOE has concluded that imposition of a standard 
at TSL 0.5 is not economically justified because the operating costs of 
the covered product are insufficient to recover the upfront cost. Based 
on these considerations, DOE is not amending energy conservation 
standards to adopt TSL 0.5 for GSILs.
    DOE has presented additional consumer choice analysis anticipating 
that if it were to establish a standard at TSL 0.5, consumers would 
substitute other available products, such as LED lamps and CFLs (the 
substitution scenario). DOE then estimated the NPV of the total costs 
and benefits experienced by the Nation in this scenario. DOE also 
conducted an MIA to estimate the impact of amended energy conservation 
standards on manufacturers of GSILs in this consumer choice scenario.
    Under the substitution analysis, the NPV of consumer benefits at 
TSL 0.5 would be $2.518 billion using a discount rate of 7 percent, and 
$4.378 billion using a discount rate of 3 percent. However, this NPV is 
based on the anticipated lifecycle costs to consumers who substitute 
other lamps due to the unavailability of GSILs. As explained elsewhere 
in this document, EPCA requires DOE to compare the savings in operating 
costs of the covered product compared to any cost increase of the 
covered products which are likely to result from the imposition of the 
standard. (42 U.S.C. 6295(o)(2)(B)(i)(II)) Although the NPV is 
projected based on shipments of out-of-scope lamps, DOE's consideration 
of life cycle costs is limited to the covered product examined here--
that is, GSILs.
    EPCA prohibits DOE from prescribing an amended or new standard if 
that the standard is likely to result in the unavailability in the 
United States in any covered product type (or class) of performance 
characteristics (including reliability), features, sizes, capacities, 
and volumes that are substantially the same as those generally 
available in the United States at the time of the Secretary's finding. 
In addition to being economically unjustified, amended standards for 
GSILs would result in the unavailability of a product type, performance 
characteristic or feature in contravention of EPCA.
    In this final determination, based on the determination that 
amended standards would not be economically justified, DOE has 
determined that energy conservation standards for GSILs do not need to 
be amended.

VIII. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and Administrative Procedure Act

    This final determination has been determined to be a significant 
regulatory action for purposes of Executive Order 12866, ``Regulatory 
Planning and Review,'' 58 FR 51735 (Oct. 4, 1993). As a result, OMB 
reviewed this rule.
    DOE finds good cause pursuant to 5 U.S.C. 553(d)(3) to waive the 
delay in effective date for this rule. The energy conservation 
standards applicable to GSILs will be precisely the same after the 
effective date of this rule as they are

[[Page 71669]]

prior to that date. As such, a delay in effectiveness is unnecessary as 
it would serve no useful purpose.

B. Review Under Executive Orders 13771 and 13777

    On January 30, 2017, the President issued Executive Order 
(``E.O.'') 13771, ``Reducing Regulation and Controlling Regulatory 
Costs.'' E.O. 13771 stated the policy of the executive branch is to be 
prudent and financially responsible in the expenditure of funds, from 
both public and private sources. E.O. 13771 stated it is essential to 
manage the costs associated with the governmental imposition of private 
expenditures required to comply with Federal regulations.
    Additionally, on February 24, 2017, the President issued E.O. 
13777, ``Enforcing the Regulatory Reform Agenda.'' E.O. 13777 required 
the head of each agency designate an agency official as its Regulatory 
Reform Officer (``RRO''). Each RRO oversees the implementation of 
regulatory reform initiatives and policies to ensure that agencies 
effectively carry out regulatory reforms, consistent with applicable 
law. Further, E.O. 13777 requires the establishment of a regulatory 
task force at each agency. The regulatory task force is required to 
make recommendations to the agency head regarding the repeal, 
replacement, or modification of existing regulations, consistent with 
applicable law. At a minimum, each regulatory reform task force must 
attempt to identify regulations that:
    (i) Eliminate jobs, or inhibit job creation;
    (ii) Are outdated, unnecessary, or ineffective;
    (iii) Impose costs that exceed benefits;
    (iv) Create a serious inconsistency or otherwise interfere with 
regulatory reform initiatives and policies;
    (v) Are inconsistent with the requirements of Information Quality 
Act, or the guidance issued pursuant to that Act, in particular those 
regulations that rely in whole or in part on data, information, or 
methods that are not publicly available or that are insufficiently 
transparent to meet the standard for reproducibility; or (vi) Derive 
from or implement Executive Orders or other Presidential directives 
that have been subsequently rescinded or substantially modified.
    As discussed in this document, DOE is not amending the energy 
conservation standards for GSILs and the final determination would not 
yield any costs or cost savings. Therefore, this final determination is 
an E.O. 13771 other action.

C. 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 (``IRFA'') 
and a final regulatory flexibility analysis (``FRFA'') for any rule 
that by law must be proposed for public comment, unless the agency 
certifies that the rule, if promulgated, will not have a significant 
economic impact on a substantial number of small entities. As required 
by Executive Order 13272, ``Proper Consideration of Small Entities in 
Agency Rulemaking,'' 67 FR 53461 (Aug. 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 website (http://energy.gov/gc/office-general-counsel).
    DOE reviewed this final determination under the provisions of the 
Regulatory Flexibility Act and the policies and procedures published on 
February 19, 2003. DOE is not amending energy conservation standards 
for GSILs. On the basis of the foregoing, DOE certifies that this final 
determination does not have a significant economic impact on a 
substantial number of small entities. Accordingly, DOE has not prepared 
an FRFA for this final determination.

D. Review Under the National Environmental Policy Act of 1969

    DOE has analyzed this final determination in accordance with the 
National Environmental Policy Act of 1969 (``NEPA'') and DOE's NEPA 
implementing regulations (10 CFR part 1021). DOE's regulations include 
a categorical exclusion for actions which are interpretations or 
rulings with respect to existing regulations. 10 CFR part 1021, subpart 
D, appendix A4. DOE has determined that this action qualifies for 
categorical exclusion A4 because it is an interpretation or ruling in 
regards to an existing regulation and otherwise meets the requirements 
for application of a categorical exclusion. See 10 CFR 1021.410.

E. Review Under Executive Order 13132

    Executive Order 13132, ``Federalism,'' 64 FR 43255 (Aug. 10, 1999), 
imposes certain requirements on Federal agencies formulating and 
implementing policies or regulations that preempt State law or that 
have Federalism implications. The Executive Order requires agencies to 
examine the constitutional and statutory authority supporting any 
action that would limit the policymaking discretion of the States and 
to carefully assess the necessity for such actions. The Executive Order 
also requires agencies to have an accountable process to ensure 
meaningful and timely input by State and local officials in the 
development of regulatory policies that have Federalism implications. 
On March 14, 2000, DOE published a statement of policy describing the 
intergovernmental consultation process it will follow in the 
development of such regulations. 65 FR 13735. EPCA governs and 
prescribes Federal preemption of State regulations as to energy 
conservation for the products that are the subject of this final 
determination. A discussion of Federal preemption as it applies to 
GSILs can be found in section V.E of this final rule. DOE has examined 
this rule and has determined that it 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. Therefore, no 
further action is required by 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,'' 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, (3) 
provide a clear legal standard for affected conduct rather than a 
general standard, and (4) promote simplification and burden reduction. 
61 FR 4729 (Feb. 7, 1996). Regarding the review required by section 
3(a), 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

[[Page 71670]]

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, this final 
determination meets the relevant standards of Executive Order 12988.

G. Review Under the Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (``UMRA'') 
requires each Federal agency to assess the effects of Federal 
regulatory actions on State, local, and Tribal governments and the 
private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). 
For a regulatory action likely to result in a rule that may cause the 
expenditure by State, local, and Tribal governments, in the aggregate, 
or by the private sector of $100 million or more in any one year 
(adjusted annually for inflation), section 202 of UMRA requires a 
Federal agency to publish a written statement that estimates the 
resulting costs, benefits, and other effects on the national economy. 
(2 U.S.C. 1532(a), (b)) The UMRA also requires a Federal agency to 
develop an effective process to permit timely input by elected officers 
of State, local, and Tribal governments on a ``significant 
intergovernmental mandate,'' and requires an agency plan for giving 
notice and opportunity for timely input to potentially affected small 
governments before establishing any requirements that might 
significantly or uniquely affect them. On March 18, 1997, DOE published 
a statement of policy on its process for intergovernmental consultation 
under UMRA. 62 FR 12820. DOE's policy statement is also available at 
http://energy.gov/sites/prod/files/gcprod/documents/umra_97.pdf.
    DOE has concluded that this final determination does not contain a 
Federal intergovernmental mandate, nor is it expected to require 
expenditures of $100 million or more in any one year by the private 
sector. As a result, the analytical requirements of UMRA do not apply.

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

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family 
Policymaking Assessment for any rule that may affect family well-being. 
This rule would not have any impact on the autonomy or integrity of the 
family as an institution. Accordingly, DOE has concluded that it is not 
necessary to prepare a Family Policymaking Assessment.

I. Review Under Executive Order 12630

    Pursuant to Executive Order 12630, ``Governmental Actions and 
Interference with Constitutionally Protected Property Rights,'' 53 FR 
8859 (March 18, 1988), DOE has determined that this rule would not 
result in any takings that might require compensation under the Fifth 
Amendment to the U.S. Constitution.

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

    Section 515 of the Treasury and General Government Appropriations 
Act, 2001 (44 U.S.C. 3516, note) provides for Federal agencies to 
review most disseminations of information to the public under 
information quality guidelines established by each agency pursuant to 
general guidelines issued by OMB. 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 this final determination 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 OIRA 
at OMB, a Statement of Energy Effects for any significant energy 
action. A ``significant energy action'' is defined as any action by an 
agency that promulgates or is expected to lead to promulgation of a 
final rule, and that (1) is a significant regulatory action under 
Executive Order 12866, or any successor order; and (2) is likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy, or (3) is designated by the Administrator of OIRA as a 
significant energy action. For any significant energy action, the 
agency must give a detailed statement of any adverse effects on energy 
supply, distribution, or use should the proposal be implemented, and of 
reasonable alternatives to the action and their expected benefits on 
energy supply, distribution, and use.
    DOE has concluded that this regulatory action, which does not adopt 
amended energy conservation standards for GSILs, is not a significant 
energy action because the standards are not likely to have a 
significant adverse effect on the supply, distribution, or use of 
energy, nor has it been designated as such by the Administrator at 
OIRA. Accordingly, DOE has not prepared a Statement of Energy Effects 
on this final determination.

L. Information Quality

    On December 16, 2004, OMB, in consultation with the Office of 
Science and Technology Policy (``OSTP''), issued its Final Information 
Quality Bulletin for Peer Review (``the Bulletin''). 70 FR 2664 (Jan. 
14, 2005). The Bulletin establishes that certain scientific information 
shall be peer reviewed by qualified specialists before it is 
disseminated by the Federal Government, including influential 
scientific information related to agency regulatory actions. The 
purpose of the Bulletin is to enhance the quality and credibility of 
the Government's scientific information. Under the Bulletin, the energy 
conservation standards rulemaking analyses are ``influential scientific 
information,'' which the Bulletin defines as ``scientific information 
the agency reasonably can determine will have, or does have, a clear 
and substantial impact on important public policies or private sector 
decisions.'' Id. at 70 FR 2667.
    In response to OMB's Bulletin, DOE conducted formal peer reviews of 
the energy conservation standards development process and the analyses 
that are typically used and prepared a report describing that peer 
review.\65\ Generation of this report involved a rigorous, formal, and 
documented evaluation using objective criteria and qualified and 
independent reviewers to make a judgment as to the technical/
scientific/business merit, the actual or anticipated results, and the 
productivity and management effectiveness of programs and/or projects. 
DOE has determined that the peer-reviewed analytical process continues 
to reflect current practice, and the Department followed that process 
for developing energy conservation standards in the case of the present 
rulemaking.
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    \65\ The 2007 ``Energy Conservation Standards Rulemaking Peer 
Review Report'' is available at the following website: http://energy.gov/eere/buildings/downloads/energy-conservation-standards-rulemaking-peer-review-report-0.
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M. Congressional Notification

    As required by 5 U.S.C. 801, DOE will report to Congress on the 
promulgation of this rule prior to its effective date. The report will 
state that it has been determined that the rule is not a ``major rule'' 
as defined by 5 U.S.C. 804(2).

[[Page 71671]]

IX. Approval of the Office of the Secretary

    The Secretary of Energy has approved publication of this final 
determination.

    Signed in Washington, DC, on December 17, 2019.
Daniel R. Simmons,
Assistant Secretary, Energy Efficiency and Renewable Energy.
[FR Doc. 2019-27515 Filed 12-26-19; 8:45 a.m.]
 BILLING CODE 6450-01-P