Review of Methods Used by the U.S. Department of Energy in Setting Appliance and Equipment Standards (2021) / Chapter Skim
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Pages 1-8
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DOE issues standards regulations by rulemaking and includes quantitative maximum water and energy use or minimum energy conservation standards. There are currently standards regulations for more than 70 product classes (i.e., a specific type of consumer product or commercial or industrial equipment)
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. which the Secretary determines is technologically feasible and economically justified," which involves evaluating "whether the benefits of the standard exceed its burdens." In addition, the Administrative Procedure Act, the Regulatory Flexibility Act, and other laws concerning administrative process guide DOE's issuance of regulations.
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(Recommendation 2-2) DOE's regulatory analyses that support tighter standards are often premised upon an energy efficiency gap -- that is, DOE's engineering analysis demonstrates that readily available technologies save far more in energy costs than they require in upfront costs.
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The use of actual test data, including experience from previously implemented standards in place of computer simulation or to validate computer simulations, will improve the analytical outcomes. DOE should expand the cost analysis segment of the engineering analysis to include ranges of costs, patterns of consumption, diversity factors, energy peak demand, and variance regarding environmental factors.
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and usage (to better model variability) ; as well as measures of in situ product performance (to more accurately measure energy consumption of products as deployed and used)
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These alternatives are not standards regulations but rather involve other types of government interventions related to, for example, taxes or rebates that affect consumer choice; voluntary targets perhaps combined with information campaigns; government purchases; and the no-action alternative. The RIA presents an opportunity to estimate the effectiveness of other means of achieving the goals of the Appliance and Equipment Standards Program.
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; the evolution of the integrated grid; the move toward electrification; and regulatory changes involving electricity markets that can transform the role of appliance standards in achieving energy efficiency. This transformation is an opportunity for DOE to develop a standards program that encompasses the entire scope of energy utilization -- appliances, their installation, controls, and the built environment.
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Ex-post analysis of the costs and benefits of the standards would both provide a check on the assumptions made when the rulemaking was promulgated and offer a guide on how to improve future standards. The extent of uncertainty in estimating costs and benefits of proposed standards underscores the value of analyzing the underlying market conditions that suggest standards regulation will be beneficial.
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