83 FR 54883 - Energy Conservation Program: Energy Conservation Standards for Residential Furnaces and Commercial Water Heaters, Notice of Petition for Rulemaking

DEPARTMENT OF ENERGY

Federal Register Volume 83, Issue 212 (November 1, 2018)

Page Range		54883-54888
FR Document		2018-23885

On October 18, 2018, the Department of Energy (DOE) received a petition from the American Public Gas Association (APGA), Spire, Inc., the Natural Gas Supply Association (NGSA), the American Gas Association (AGA), and the National Propane Gas Association (NPGA), collectively referred to as the ``Gas Industry Petitioners,'' asking DOE to: Issue an interpretive rule stating 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 the Energy Policy and Conservation Act of 1975, as amended (i.e., by setting standards which can only be met by condensing combustion technology products/equipment and thereby precluding the distribution in commerce of non-condensing combustion technology products/equipment) and withdraw the proposed energy conservation standards for residential furnaces and commercial water heaters based upon such findings. Through this notice, DOE seeks comment on the petition, as well as any data or information that could be used in DOE's determination whether to proceed with the petition.

Federal Register, Volume 83 Issue 212 (Thursday, November 1, 2018)

[Federal Register Volume 83, Number 212 (Thursday, November 1, 2018)]
[Proposed Rules]
[Pages 54883-54888]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2018-23885]

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Proposed Rules
Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 83, No. 212 / Thursday, November 1, 2018 /
Proposed Rules

[[Page 54883]]

DEPARTMENT OF ENERGY

10 CFR Parts 430 and 431

Energy Conservation Program: Energy Conservation Standards for
Residential Furnaces and Commercial Water Heaters, Notice of Petition
for Rulemaking

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

ACTION: Notice of petition for rulemaking; request for comment.

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SUMMARY: On October 18, 2018, the Department of Energy (DOE) received a
petition from the American Public Gas Association (APGA), Spire, Inc.,
the Natural Gas Supply Association (NGSA), the American Gas Association
(AGA), and the National Propane Gas Association (NPGA), collectively
referred to as the ``Gas Industry Petitioners,'' asking DOE to: Issue
an interpretive rule stating 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 the Energy Policy and Conservation Act of 1975, as
amended (i.e., by setting standards which can only be met by condensing
combustion technology products/equipment and thereby precluding the
distribution in commerce of non-condensing combustion technology
products/equipment) and withdraw the proposed energy conservation
standards for residential furnaces and commercial water heaters based
upon such findings. Through this notice, DOE seeks comment on the
petition, as well as any data or information that could be used in
DOE's determination whether to proceed with the petition.

DATES: Written comments and information are requested on or before
January 30, 2019.

ADDRESSES: Interested persons are encouraged to submit comments,
identified by ``Energy Conservation Standards for Residential Furnaces
and Commercial Water Heaters,'' by any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov. Follow the
instructions for submitting comments.
E-mail: ResFurnaceCommWaterHeater2018STD0018@ee.doe.gov. Include
Docket No. EERE-2018-BT-STD-0018 in the subject line of the message.
Postal Mail: Appliance and Equipment Standards Program, U.S.
Department of Energy, Building Technologies Office, Mailstop EE-5B,
1000 Independence Avenue SW, Washington, DC 20585-0121. If possible,
please submit all items on a compact disc (CD), in which case it is not
necessary to include printed copies.
Hand Delivery/Courier: Appliance and Equipment Standards Program,
U.S. Department of Energy, Building Technologies Office, 950 L'Enfant
Plaza SW, Suite 600, Washington, DC 20024. Telephone: (202) 287-1445.
If possible, please submit all items on a CD, in which case it is not
necessary to include printed copies.
Docket: For access to the docket to read background documents, or
comments received, go to the Federal eRulemaking Portal at: http://www.regulations.gov/docket?D=EERE-2018-BT-STD-0018.

FOR FURTHER INFORMATION CONTACT: Mr. Eric Stas, U.S. Department of
Energy, Office of the General Counsel, 1000 Independence Avenue SW,
Washington, DC 20585. Telephone: (202) 586-9507. E-mail:
Eric.Stas@hq.doe.gov.

SUPPLEMENTARY INFORMATION: The Administrative Procedure Act (APA), 5
U.S.C. 551 et seq., provides among other things, that ``[e]ach agency
shall give an interested person the right to petition for the issuance,
amendment, or repeal of a rule.'' (5 U.S.C. 553(e)) DOE received a
petition from the Gas Industry Petitioners, as described in this notice
and set forth verbatim below, requesting that DOE: (1) Issue an
interpretive rule stating 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 the Energy Policy and Conservation Act of 1975 (42
U.S.C. 6291 et seq.; EPCA), as amended (i.e., by setting standards
which can only be met by condensing combustion technology products/
equipment and thereby precluding the distribution in commerce of non-
condensing combustion technology products/equipment) and (2) withdraw
the proposed energy conservation standards for residential furnaces and
commercial water heaters based upon such findings. In promulgating this
petition for public comment, DOE is seeking views on whether it should
grant the petition and undertake an interpretive rulemaking and
withdrawal of the two specified rulemaking proposals, as requested. By
seeking comment on whether to grant this petition, DOE takes no
position at this time regarding the merits of the suggested rulemaking
or the assertions made by the Gas Industry Petitioners.
In their petition, the Gas Industry Petitioners argue that DOE
misinterpreted its mandate under section 325(o)(4) of EPCA by failing
to consider as a ``feature'' of the subject residential furnaces and
commercial water heating equipment the compatibility of a product/
equipment with conventional atmospheric venting systems and the ability
to operate without generating liquid condensate requiring disposal via
a plumbing connection. Consequently, the Gas Industry Petitioners
assert that DOE's proposals would make unavailable non-condensing
products/equipment with such features, which currently exist in the
marketplace, in contravention of the statute. The petition makes a
number of technical, legal, and economic arguments in favor of its
proposed interpretation, and it points to DOE's past precedent related
to space constraints and differences in available electrical power
supply (and associated installation costs) as supporting its call to
find that non-condensing technology amounts to a performance-related
``feature.'' Based upon these arguments, the Gas Industry Petitioners
conclude that DOE should issue an interpretive rule treating non-
condensing technology as a ``feature'' under EPCA, withdraw its
rulemaking proposals for both residential furnaces and commercial water
heaters, and proceed on the basis of this revised interpretation.
DOE welcomes comments and views of interested parties on any aspect
of the petition for rulemaking.

[[Page 54884]]

Submission of Comments

DOE invites all interested parties to submit in writing by January
30, 2019 comments and information regarding this petition.
Submitting comments via http://www.regulations.gov. The http://www.regulations.gov webpage will require you to provide your name and
contact information prior to submitting comments. Your contact
information will be viewable to DOE Building Technologies staff only.
Your contact information will not be publicly viewable except for your
first and last names, organization name (if any), and submitter
representative name (if any). If your comment is not processed properly
because of technical difficulties, DOE will use this information to
contact you. If DOE cannot read your comment due to technical
difficulties and cannot contact you for clarification, DOE may not be
able to consider your comment.
However, your contact information will be publicly viewable if you
include it in the comment or in any documents attached to your comment.
Any information that you do not want to be publicly viewable should not
be included in your comment, nor in any document attached to your
comment. Persons viewing comments will see only first and last names,
organization names, correspondence containing comments, and any
documents submitted with the comments.
Do not submit to http://www.regulations.gov information for which
disclosure is restricted by statute, such as trade secrets and
commercial or financial information (hereinafter referred to as
Confidential Business Information (CBI)). Comments submitted through
http://www.regulations.gov cannot be claimed as CBI. Comments received
through the website will waive any CBI claims for the information
submitted. For information on submitting CBI, see the Confidential
Business Information section.
DOE processes submissions made through http://www.regulations.gov
before posting. Normally, comments will be posted within a few days of
being submitted. However, if large volumes of comments are being
processed simultaneously, your comment may not be viewable for up to
several weeks. Please keep the comment tracking number that http://www.regulations.gov provides after you have successfully uploaded your
comment.
Submitting comments via email, hand delivery, or postal mail.
Comments and documents via email, hand delivery, or postal mail will
also be posted to http://www.regulations.gov. If you do not want your
personal contact information to be publicly viewable, do not include it
in your comment or any accompanying documents. Instead, provide your
contact information on a cover letter. Include your first and last
names, email address, telephone number, and optional mailing address.
The cover letter will not be publicly viewable as long as it does not
include any comments.
Include contact information in your cover letter each time you
submit comments, data, documents, and other information to DOE. If you
submit via postal mail or hand delivery, please provide all items on a
CD, if feasible, in which case it is not necessary to submit printed
copies. No telefacsimiles (faxes) will be accepted.
Comments, data, and other information submitted electronically
should be provided in PDF (preferred), Microsoft Word or Excel,
WordPerfect, or text (ASCII) file format. Provide documents that are
not secured, written in English, and free of any defects or viruses.
Documents should not include any special characters or any form of
encryption, and, if possible, they should carry the electronic
signature of the author.
Campaign form letters. Please submit campaign form letters by the
originating organization in batches of between 50 to 500 form letters
per PDF or as one form letter with a list of supporters' names compiled
into one or more PDFs. This reduces comment processing and posting
time.
Confidential Business Information. Pursuant to 10 CFR 1004.11, any
person submitting information that he or she believes to be
confidential and exempt by law from public disclosure should submit via
email, postal mail, or hand delivery two well-marked copies: one copy
of the document marked ``Confidential'' including all the information
believed to be confidential, and one copy of the document marked ``Non-
confidential'' with the information believed to be confidential
deleted. Submit these documents via email or on a CD, if feasible. DOE
will make its own determination about the confidential status of the
information and treat it according to its determination.
Factors of interest to DOE when evaluating requests to treat
submitted information as confidential include: (1) A description of the
items; (2) whether and why such items are customarily treated as
confidential within the industry; (3) whether the information is
generally known by or available from other sources; (4) whether the
information has previously been made available to others without
obligation concerning its confidentiality; (5) an explanation of the
competitive injury to the submitting person which would result from
public disclosure; (6) when such information might lose its
confidential character due to the passage of time, and (7) why
disclosure of the information would be contrary to the public interest.
It is DOE's policy that all comments may be included in the public
docket, without change and as received, including any personal
information provided in the comments (except information deemed to be
exempt from public disclosure).
DOE considers public participation to be a very important part of
its process for considering rulemaking petitions. DOE actively
encourages the participation and interaction of the public during the
comment period. Interactions with and between members of the public
provide a balanced discussion of the issues and assist DOE in
determining how to proceed with a petition. Anyone who wishes to be
added to DOE mailing list to receive future notices and information
about this petition should contact Appliance and Equipment Standards
Program staff at (202) 287-1445 or via e-mail at
ApplianceStandardsQuestions@ee.doe.gov.

Approval of the Office of the Secretary

The Secretary of Energy has approved publication of this notice of
petition for rulemaking.

Signed in Washington, DC, on October 25, 2018.
Kathleen B. Hogan,
Deputy Assistant Secretary for Energy Efficiency, Energy Efficiency and
Renewable Energy.

October 18, 2018

BEFORE THE OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY UNITED
STATES DEPARTMENT OF ENERGY WASHINGTON, D.C.

Petition for Rulemaking

Energy Conservation Program: Energy Conservation Standards for
Residential Furnaces

Docket Number EERE-2014-BT-STD-031; RIN No. 1904-AD20

Energy Conservation Program:

Energy Conservation Standards for Commercial Water Heaters

[[Page 54885]]

Docket Number EERE-2014-BT-STD-042; RIN No. 1904-AD34

Introduction

The undersigned organizations submit this petition for rulemaking
under 5 U.S.C. Sec. 553(e). As explained below, we request that the
Department of Energy (``DOE''):

Issue an interpretive rule confirming that energy conservation
standards effectively limiting the market for natural gas and/or
propane gas (``fuel gas'') furnaces or water heaters to products using
condensing combustion technology would result in the unavailability of
``performance characteristics'' within the meaning of the Energy Policy
and Conservation Act of 1975, as amended (``EPCA''), 42 U.S.C. Sec.
6291 et seq., and, consistent with that determination,
Withdraw its proposed standards for residential furnaces and
commercial water heaters on the grounds of appropriate written findings
as specified by 42 U.S.C. Sec. Sec. 6295(0)(4) and
6313(a)(6)(B)(iii)(II), respectively.\1\
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\1\ Standards for non-weatherized residential furnaces were
published in a notice of proposed rulemaking at 80 Fed. Reg. 13120
(March 12, 2015) (``NOPR'') and in a supplemental notice of proposed
rulemaking published at 81 Fed. Reg. 65720 (September 23, 2016)
(Docket No. EERE-2014-BT-STD-0031); standards for commercial water
heating equipment were published at 81 Fed. Reg. 34440 (May 31,
2016) (Docket No. EERE-2014-BT-STD-0042). Petitioners request that
DOE withdraw all of the standards proposed in these two proceedings.
The same issue is presented in the proposed rule for commercial
packaged boiler energy conservation standards, Notice of Proposed
Rulemaking and Announcement of Public Meeting, 81 Fed. Reg. 15836
(Mar. 24, 2016); litigation concerning that rulemaking is currently
pending in the United States Court of Appeals for the Ninth Circuit.
NRDC v. Perry, (Nos. 18-15380, 18-1545).
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We believe that these actions would appropriately resolve issues that
have already contributed to delays in both the residential furnace and
commercial water heater rulemaking proceedings, thereby facilitating a
more orderly and efficient resolution of the remaining issues in these
proceedings.
The basis for this petition is straight forward. The compatibility
of a product with conventional atmospheric venting systems is an
important product feature, as is the ability of a product to operate
without generating liquid condensate requiring disposal via a plumbing
connection. Residential furnaces and commercial water heaters that
provide these features are generally available in the United States
now. Products that use condensing combustion technology (``condensing
products'') lack either one of these features. Efficiency standards
that can only be achieved through the use of condensing combustion
technology would therefore have the effect of rendering products with
these features unavailable in the United States, a circumstance that
EPCA was specifically designed to preclude.
EPCA expressly provides that DOE:

may not prescribe an amended standard . . . if the Secretary finds
(and publishes the finding) that interested persons have demonstrated
by a preponderance of the evidence that a standard is likely to result
in the unavailability in the United States or any 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
finding of the Secretary.\2\
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\2\ 42 U.S.C. Sec. Sec. 6295(0)(4) (applicable to residential
furnaces) and 6313(a)(6)(B)(iii)(II) (identical provision applicable
to commercial water heaters).

There are no material facts in dispute. In both the residential
furnace and commercial water heater rulemaking proceedings,\3\
interested parties have demonstrated by a preponderance of the
evidence--and DOE has itself acknowledged \4\--that:
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\3\ See note 1.
\4\ 81 Fed. Reg. 65720 at 65752-53 (Sept. 23, 2016) (residential
furnaces); 81 Fed. Reg. 34440 at 34462-63 (May 31, 2016) (commercial
water heating equipment). Cf. ``An Energy Revolution'' [an interview
with DOE Secretary Perry] American Gas (October 2017) (``We are not
going to pursue policies that tell businesses and consumers to
choose one energy source over another. . . . The American people
should be able to use the type of energy that they think is best for
their businesses, their lives and their families.'').
http://read.nxtbook.com/aga/american_gas_magazine/american_gas_oct_2017/index.html?utm_source=twitter&utm_medium=social&utm_content=Oktopost-twitter-profile&utm_campaign=Oktopost-WGC+2018#an_energy_revolution

The standards proposed for residential furnaces and commercial
water heaters (with a limited exception for certain ``small''
residential furnaces) can only be achieved by condensing products;
Condensing products lack both the ability to function with
atmospheric venting systems and the ability to function without
generating liquid condensate requiring disposal via a plumbing
connection;
Products that have the ability to function with atmospheric
venting systems and without generating liquid condensate requiring
disposal via a plumbing connection are currently available in the
United States; and
Standards that can be achieved only by condensing products
would make such products unavailable.

The only issue to be resolved is whether the product features at
issue are ``performance characteristics'' for purposes of 42 U.S.C.
Sec. Sec. 6295(0)(4) and 6313(a)(6)(B)(iii)(II), and they plainly
are.\5\ Accordingly, DOE should issue an interpretive rule confirming
that this is the case, and--consistent with that determination--should
withdraw its proposed standards for residential furnaces and commercial
water heaters on the basis of appropriate written findings pursuant to
42 U.S.C. Sec. Sec. 6295(0)(4) and 6313(a)(6)(B)(iii)(II),
respectively.
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\5\ See Joint Request for Interpretation, EERE-2014-BT-STD-0031
(filed June 6, 2017) at p. 3 (``It is absurd to suggest that
features that may be necessary to make the use of a product
practical (or even possible) are not ``performance-related
features'' for EPCA purposes.). See also White Paper Developed by
the American Gas Association and American Public Gas Association,
``In the Upcoming Rulemaking on Amendments to the Minimum Efficiency
Standards for Non-Weatherized Residential Gas Furnaces, DOE Should
Employ Separate Product Classes for Condensing and Noncondensing
Furnaces'' (Oct. 22, 2014) (detailing the unique performance-related
characteristics and consumer utility of non-condensing furnaces)
(attached to Joint Request for Interpretation, supra).
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Features Precluded by the Use of Condensing Combustion Technology

Conventional fuel gas products are designed for atmospheric
venting, typically through vent systems that carry exhaust gases, via
buoyancy, vertically through the roof of the buildings in which they
are installed. The vast majority of existing buildings and homes in
which fuel gas products are installed in the United States were built
with atmospheric venting systems designed to accommodate such products.
Atmospherically-vented products are compatible with these existing
venting systems (and with other atmospherically-vented products that
use them); condensing products are not.
Gas products using condensing combustion technology provide
increased thermal efficiency by extracting additional heat from
combustion gases before they are vented. As a result, condensing
products produce liquid condensate and cooler exhaust gases that lack
sufficient buoyancy to exit a building via an atmospheric venting
system. Condensing products therefore require plumbing for condensate
disposal and ``power'' (i.e., positive pressure) venting, typically
through horizontal venting penetrating an exterior building wall.
Importantly, power-vented products cannot share common vent systems
with atmospherically-vented products under the prevailing national
model

[[Page 54886]]

codes.\6\ Positive pressure in such a vent system would force
combustion products into occupied spaces within the building through
draft hoods and other atmospheric vent system structures. For this
reason, safety standards and installation codes specifically separate
vented fuel gas appliances and equipment into different categories
based on their venting characteristics and specify that power-vented
products cannot be connected to atmospheric venting systems or share
common venting systems with atmospherically-vented gas products. In
addition, condensing products require plumbing for condensate disposal
that other vented gas products generally do not.
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\6\ ``National Fuel Gas Code, 2015 Edition,'' ANSI Z223.1/NFPA
54/, American Gas Association/National Fire Protection Association,
2015, and ``International Fuel Gas Code,'' International Code
Council/American Gas Association, 2015.
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As further explained below and in comments submitted previously in
the residential furnace and commercial water heater rulemaking
proceedings, the features condensing products lack--compatibility with
existing atmospheric venting systems and the ability to operate without
a plumbing connection--are extremely important to consumers. Products
with these features can be installed in locations inside buildings
where condensing products cannot. Most significantly, non-condensing
products can replace existing atmospherically-vented products without
triggering the need for expensive building modifications or premature
replacement of other commonly-vented gas products. Therefore, if these
features were unavailable, there would be many cases in which it would
be impractical to replace existing gas products with new gas products.

The Statutory Scheme, Precedent, and Application

Energy Policy and Conservation Act

Products that offer different features are often capable of
achieving different measured efficiencies. Where this is the case,
there is a potential that a particular efficiency standard could be
achievable for products with some features but not achievable for
products with other features, in which case the standard would
effectively ban products with the latter features.
Congress anticipated such situations, and it made it clear that DOE
is authorized to regulate product efficiency but not to restrict the
range of features that covered products can provide. In fact, Congress
expressly sought to ensure ``that energy savings are not achieved
through the loss of significant consumer features.'' \7\ EPCA expressly
prohibits the adoption of an energy conservation standard if it has
been shown that the standard would have the effect of eliminating a
currently-available product feature from the market. 42 U.S.C.
Sec. Sec. 6295(o)(4) and 6313(a)(6)(B)(iii)(II). If DOE determines
that a more stringent standard would be appropriate for products with
specific product features, it can impose such standards for products
with those features. Specifically, DOE can ``establish different
standards within [a] type of covered product . . . based upon
performance-related features of the product.'' \8\ However, DOE can do
this only by creating separate product classes for products with
different performance-related features and specifying different (and
achievable) standards for each. 42 U.S.C. Sec. 6295(q)(1). This
statutory scheme was expressly designed ``to ensure that an amended
standard does not deprive consumers of product choices and
characteristics, features, sizes, etc.,'' and to ``preclude'' the
adoption of standards ``that manufacturers are only able to meet by
adopting engineering changes that eliminate performance
characteristics.'' \9\ Unfortunately, that is exactly what DOE's
proposed standards for residential furnaces and commercial water
heaters would do.
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\7\ H.R. Rep. No. 100-11, 22 (1987).
\8\ National Energy Conservation Act 1978, H.R. Rep. 95-1751,
115 (1978).
\9\ H.R. Rep. No. 100-11, 23 (1987).
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Again, there is no dispute as to the relevant facts: DOE has
acknowledged that its proposed efficiency standards can only be
achieved through use of condensing combustion technology, and that
those standards would effectively eliminate gas products that are
compatible with atmospheric venting systems and do not require a
plumbing connection.\10\ DOE has simply suggested that the elimination
of such products does not constitute a loss of product features for
purposes of 42 U.S.C. Sec. Sec. 6295(0)(4) and
6313(a)(6)(B)(iii)(II).\11\ This suggestion is inconsistent both with
EPCA's provisions and DOE's own previous determinations.
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\10\ See 81 Fed. Reg. 65720 at 65752-53 (Sept. 23, 2016)
(residential furnaces); 81 Fed. Reg. 34440 at 34462-63 (May 31,
2016) (commercial water heating equipment).
\11\ Furnace SNOPR, 81 Fed. Reg. at 65752. This suggestion dates
back to the vacated Direct Final Rule, Energy Conservation Program:
Energy Conservation Standards for Residential Furnaces and
Residential Central Air Conditioners and Heat Pumps, 76 Fed. Reg.
37407, (June 27, 2011) (``Direct Final Rule''). Under an April 24,
2014 order of the United States Court of Appeals for the District of
Columbia Circuit approving a settlement among the parties including
DOE, that rule (including but not limited to DOE's determination
that residential furnaces constitute a single class of products for
purposes of 42 U.S.C. 6295(q)(1)(B)) was vacated and remanded to DOE
for notice and comment rulemaking. Thus, DOE agreed, and the court
ordered, that DOE reconsider the question of whether condensing and
non-condensing non-weatherized gas furnaces should be treated as
separate product classes in future rulemaking covering these
products. DOE's subsequent failure to appropriately resolve this
issue has significantly complicated (and thus delayed) development
of a final rule regarding residential furnace standards, and has
been the subject of extensive adverse comment. E.g., APGA
Residential Furnace Comments at 6-11 (filed Nov. 22, 2016) (``DOE
fails to address the line of contrary precedent that APGA brought to
its attention.''); AGA Comments at 32-43 (filed Nov. 22, 2016)
(``AGA's view is that the utility and performance characteristics of
non-condensing furnaces do require the creation of a separate
product class for non-condensing furnaces.'').
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DOE Precedent

One of the ways in which DOE can avoid the adoption of standards
that would eliminate available product features is to create separate
product classes, with separate (and achievable) standards for products
with those features.\12\ In addressing the need for separate product
classes, DOE has recognized again and again that features that
significantly affect the conditions under which products can be used
are performance-related features for EPCA purposes; i.e., features that
should be preserved rather than made ``unavailable'' by an energy
conservation standard.
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\12\ See 42 U.S.C. Sec. 6295(q)(1).
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DOE has recognized different product classes for electric
residential clothes dryers to address differences in product features
concerning installation space constraints and differences in available
electrical power supply.\13\ Similarly, DOE's decision to maintain
separate product classes for ``space-constrained'' heat pump and air
conditioning products reflects the legal conclusion that product
features that resolve significant installation constraints are
performance-related features providing utility that other products
lack.\14\ The fact that DOE characterized the need to modify existing
buildings to accommodate new products as a matter of ``installation
cost'' did nothing to undermine that legal conclusion.\15\ The

[[Page 54887]]

same legal conclusion is reflected in the provisions of EPCA itself:
for example, EPCA provides separate product classes for residential
direct heating equipment based on variations in the manner in which
such products are designed to be installed.\16\
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\13\ 10 C.F.R. Sec. 430.32(h)(3).
\14\ See Direct Final Rule, 76 Fed. Reg. at 37446 (``Because
physical size constraints for through-the-wall products continue to
exist, DOE determined that continuation of the space-constrained
product class is warranted.'').
\15\ Id. at 37404 (``DOE believes that through-the-wall
equipment intended for replacement applications can meet the
definition of space-constrained products because they must fit into
a pre-existing hole in the wall, and a larger through-the-wall unit
would trigger a considerable increase in the installation cost to
accommodate the larger unit.'').
\16\ See 42 U.S.C. Sec. 6295(e)(3). See also Final Rule, Energy
Conservation Program: Energy Conservation Standards for Ceiling
Fans, 82 Fed. Reg. 6826, 6833 (Jan 19, 2017) (adopting 7 product
classes: highly-decorative, belt-driven, very small-diameter,
hugger, standard, high-speed small-diameter and large-diameter
fans). Cf. 10 C.F.R. Sec. 430.32(y) (separate the product classes
for furnace fans for non-condensing and condensing furnaces; thus
DOE distinguished between non-condensing and condensing furnaces as
an appropriate basis for creating separate product classes under
EPCA).
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In light of these precedents, DOE's continued failure to
acknowledge that standards effectively eliminating atmospherically-
vented gas products would result in a loss of performance
characteristics for purposes of 42 U.S.C. Sec. Sec. 6295(0)(4) and
6313(a)(6)(B)(iii)(II) would be arbitrary and capricious.

Application

The ability of a product to function without a plumbing connection
is a feature that is no less important than features that affect where
products will fit, what type of wiring they require, or whether they
are designed to be free-standing as opposed to being installed in a
wall or a floor. The ability of a product to function with atmospheric
venting is an even more important feature because it enables products
to be used as replacements for atmospheric-vented products without the
need for building alterations or the risk of adverse impacts on other
atmospheric-vented gas products tied to a common venting system.
These product characteristics are very important to the pocketbooks
of many American homeowners using natural gas. Many homes with a
conventional gas furnace have a commonly-vented conventional gas water
heater. If standards make atmospherically-vented furnaces unavailable,
furnace replacement may result in venting problems for the commonly-
vented water heater, with the result that a perfectly good water heater
may need to be replaced as well.\17\
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\17\ Spire Residential Furnace SNOPR Comments (filed Jan. 6,
2017) (https://www.regulations.gov/contentStreamer?documentId=EERE-2014-BT-STD-0031-0309&attachmentNumber=1&contentType=pdf) (open the
PDF document and use the search function for the word ``stranded'').
---------------------------------------------------------------------------

The importance of performance characteristics such as the ability
of a product to operate with a building's existing infrastructure and
other commonly-vented products cannot be dismissed on the grounds that
the building could be modified and other appliances scrapped. It is
unreasonable to characterize the lack of such performance
characteristics as a mere matter of ``installation costs'' \18\ or to
dismiss them as such.\19\ In any event, there are cases in which the
features condensing products lack are necessary if a gas product is to
be used at all. This can occur, for example, in scenarios involving
multistory housing in which vented gas products are common-vented into
a central venting system that serves multiple floors of residential
units that are under different ownership. In such cases, the inability
of a consumer to replace an atmospherically-vented product with another
atmospherically-vented product would not merely present problems for
the consumers involved; it could adversely affect the venting of
common-vented products owned by other parties in the same building.
---------------------------------------------------------------------------

\18\ See 81 Fed. Reg. at 65753.
\19\ Id. at 37404 (``DOE believes that through-the-wall
equipment intended for replacement applications can meet the
definition of space-constrained products because they must fit into
a pre-existing hole in the wall, and a larger through-the-wall unit
would trigger a considerable increase in the installation cost to
accommodate the larger unit.'').
---------------------------------------------------------------------------

DOE's prior assertion that standards requiring the use of
condensing combustion technology would not impose a loss of product
``features'' is based on two conflicting legal arguments. The first, as
stated in the residential furnace rulemaking, is that ``the consumer
utility of a furnace is that it provides heat to a dwelling, and the
type of venting used for particular furnace technologies does not
impact that utility.'' \20\ One obvious problem with this argument is
that it is wrong on the facts: atmospheric-venting does impact the
ability of a furnace to provide heat to a dwelling, because there are
some cases in which atmospherically-vented furnaces can be used and
condensing products cannot. Another is factors that limit the
circumstances under which products can reasonably be used--size, for
example--plainly have an impact on the utility of a product and are
unmistakably within the range of ``performance characteristics'' that
standards may not make unavailable.\21\
---------------------------------------------------------------------------

\20\ 81 Fed. Reg. at 65752.
\21\ See 42 U.S.C. Sec. 6295(0)(4) (expressly including
``sizes''--apart from ``capacities or volumes''--among the examples
of ``performance characteristics'' that cannot be made unavailable).
---------------------------------------------------------------------------

The second argument (again as stated in the context of the
residential furnace rulemaking) is that the only ``features'' that must
be preserved are those that ``provide unique utility to consumers
beyond the basic function of providing heat, which all furnaces
perform.'' \22\ The argument that a ``feature'' must have unique
utility ``beyond the basic function'' of a product is obviously
difficult to square with the argument that a ``feature'' must ``impact
the ability of a [product] to provide'' that basic function. However,
the most obvious problem is that there is simply no statutory basis to
assert either that a feature must have ``unique utility'' or that such
utility must somehow be ``beyond the basic function'' of the product.
EPCA simply states that DOE may not impose standards if it has been
shown that they would likely result in unavailability of currently-
available ``performance characteristics (including reliability,
features, sizes, capacities, and volumes).'' \23\
---------------------------------------------------------------------------

\22\ 81 Fed. Reg. at 65753.
\23\ 42 U.S.C. Sec. Sec. 6295(0)(4) and 6313(a)(6)(B)(iii)(II).

The policy concern driving these meritless legal arguments has been
stated by DOE as follows: Tying the concept of ``feature'' to a
specific technology would effectively lock-in the currently existing
technology as the ceiling for product efficiency and eliminate DOE's
ability to address significant technological advances that could yield
significant consumer benefits in the form of lower energy costs while
providing the same functionality for the consumer.'' \24\
---------------------------------------------------------------------------

\24\ 81 Fed. Reg. at 65752 (residential furnaces); 81 Fed Reg.
at 23363 (commercial water heaters).

This policy concern is at odds with the policy judgment Congress
made when it adopted the relevant statutory provisions. The limitations
on DOE's authority to impose design choices on manufacturers and
consumers were not just designed to ensure the continued availability
of products having the same ``functionality,'' particularly if
``functionality'' means nothing more than the basic ability of a
product to provide heat (or hot water, as the case may be). Instead,
Congress expressly sought to ensure ``that energy savings are not
achieved through the loss of significant consumer features.'' \25\
Features such as the compatibility of a product with an existing
building's venting system and appliances, as well as its ability to
operate without the need for a plumbing connection, are unquestionably
significant to consumers. Arguments to the contrary in the pending
rulemaking proceedings amount to transparent attempts to justify
exactly the kind of outcome

[[Page 54888]]

Congress intended to preclude: the adoption of standards that would
achieve higher efficiency by eliminating currently available
``performance characteristics'' (including ``features'') that are
important to many purchasers.
---------------------------------------------------------------------------

\25\ H.R. Rep. No. 100-11, 22 (1987).
---------------------------------------------------------------------------

Conclusion

DOE's rulemaking proceedings concerning standards for residential
furnaces and commercial water heaters have been fatally undermined by
their failure to recognize that EPCA precludes the adoption of
standards that would effectively eliminate fuel gas products that do
not use condensing combustion technology. Petitioners believe that
prompt action to correct that failure is both warranted and necessary
to facilitate any reasonably efficient path forward in those rulemaking
proceedings. Accordingly, Petitioners respectfully request that DOE--
after soliciting and appropriately considering public comment on this
Petition--promptly take final action by:

Issuing an interpretive rule confirming that energy
conservation standards limiting the market for natural gas and/or
propane gas furnaces or water heaters to products using condensing
combustion technology would result in the unavailability of
``performance characteristics'' within the meaning of 42 U.S.C.
Sec. Sec. 6295(0)(4) and 6313(a)(6)(B)(iii)(II), and
Withdrawing its proposed standards for residential furnaces
and commercial water heaters on the grounds of appropriate written
findings as specified by 42 U.S.C. Sec. Sec. 6295(0)(4) and
6313(a)(6)(B)(iii)(II), respectively.

Further deliberation in the two pending rulemaking proceedings can
then occur, with appropriate consideration--as EPCA requires--of any
need for separate standards (and separate product classes) for products
that use condensing combustion technology and those that do not.\26\
---------------------------------------------------------------------------

\26\ See 42 U.S.C. Sec. 6295(q)(1).
---------------------------------------------------------------------------

Respectfully submitted,

Mark Darrell,
Senior VP, General Counsel & Chief Compliance Officer,
Spire Inc., 700 Market Street, St. Louis, MO 63101
Email: mark.darrell@spireenergy.com.

Dena E. Wiggins,
President and CEO, Natural Gas Supply Association, 1620 Eye St NW,
Suite 700, Washington, D.C. 20006, 202.326.9300
E-mail: dena.wiggins@ngsa.org.

Mike Caldarera,
Vice President, Regulatory & Technical Services, National Propane Gas
Association, 1899 L Street, NW, Ste 350, Washington, D.C. 20036, (202)
466-7200
Email: mcaldarera@npga.org.

Bert Kalisch,
President & CEO, American Public Gas Association, 201 Massachusetts
Avenue, NE, Suite C-4, Washington, DC 20002, 202.464.2742
Email: bkalisch@apga.org.

Mike Murray,
General Counsel, American Gas Association, 400 North Capitol Street NW,
Suite 450, Washington, DC 20001, 202.824.7000
Email: mmurray@aga.org.

[FR Doc. 2018-23885 Filed 10X-31-18; 8:45 am]
BILLING CODE 6450-01-P

54883

Proposed Rules Federal Register
Vol. 83, No. 212

Thursday, November 1, 2018

This section of the FEDERAL REGISTER Standards for Residential Furnaces and combustion technology products/
contains notices to the public of the proposed Commercial Water Heaters,’’ by any of equipment and thereby precluding the
issuance of rules and regulations. The the following methods: distribution in commerce of non-
purpose of these notices is to give interested Federal eRulemaking Portal: http:// condensing combustion technology
persons an opportunity to participate in the www.regulations.gov. Follow the
rule making prior to the adoption of the final products/equipment) and (2) withdraw
instructions for submitting comments. the proposed energy conservation
rules.
E-mail: ResFurnaceCommWater standards for residential furnaces and
Heater2018STD0018@ee.doe.gov. commercial water heaters based upon
DEPARTMENT OF ENERGY Include Docket No. EERE–2018–BT– such findings. In promulgating this
STD–0018 in the subject line of the petition for public comment, DOE is
10 CFR Parts 430 and 431 message. seeking views on whether it should
Postal Mail: Appliance and
Energy Conservation Program: Energy grant the petition and undertake an
Equipment Standards Program, U.S.
Conservation Standards for interpretive rulemaking and withdrawal
Department of Energy, Building
Residential Furnaces and Commercial Technologies Office, Mailstop EE–5B, of the two specified rulemaking
Water Heaters, Notice of Petition for 1000 Independence Avenue SW, proposals, as requested. By seeking
Rulemaking Washington, DC 20585–0121. If comment on whether to grant this
possible, please submit all items on a petition, DOE takes no position at this
AGENCY: Office of Energy Efficiency and time regarding the merits of the
Renewable Energy, Department of compact disc (CD), in which case it is
not necessary to include printed copies. suggested rulemaking or the assertions
Energy. made by the Gas Industry Petitioners.
Hand Delivery/Courier: Appliance
ACTION: Notice of petition for
and Equipment Standards Program, U.S. In their petition, the Gas Industry
rulemaking; request for comment. Department of Energy, Building Petitioners argue that DOE
SUMMARY: On October 18, 2018, the Technologies Office, 950 L’Enfant Plaza misinterpreted its mandate under
Department of Energy (DOE) received a SW, Suite 600, Washington, DC 20024. section 325(o)(4) of EPCA by failing to
petition from the American Public Gas Telephone: (202) 287–1445. If possible, consider as a ‘‘feature’’ of the subject
Association (APGA), Spire, Inc., the please submit all items on a CD, in residential furnaces and commercial
Natural Gas Supply Association which case it is not necessary to include water heating equipment the
(NGSA), the American Gas Association printed copies. compatibility of a product/equipment
(AGA), and the National Propane Gas Docket: For access to the docket to with conventional atmospheric venting
Association (NPGA), collectively read background documents, or systems and the ability to operate
referred to as the ‘‘Gas Industry comments received, go to the Federal without generating liquid condensate
Petitioners,’’ asking DOE to: Issue an eRulemaking Portal at: http:// requiring disposal via a plumbing
interpretive rule stating that DOE’s www.regulations.gov/docket?D=EERE-
connection. Consequently, the Gas
proposed energy conservation standards 2018-BT-STD-0018.
Industry Petitioners assert that DOE’s
for residential furnaces and commercial FOR FURTHER INFORMATION CONTACT: Mr. proposals would make unavailable non-
water heaters would result in the Eric Stas, U.S. Department of Energy, condensing products/equipment with
unavailability of ‘‘performance Office of the General Counsel, 1000 such features, which currently exist in
characteristics’’ within the meaning of Independence Avenue SW, Washington, the marketplace, in contravention of the
the Energy Policy and Conservation Act DC 20585. Telephone: (202) 586–9507. statute. The petition makes a number of
of 1975, as amended (i.e., by setting E-mail: Eric.Stas@hq.doe.gov. technical, legal, and economic
standards which can only be met by SUPPLEMENTARY INFORMATION: The arguments in favor of its proposed
condensing combustion technology Administrative Procedure Act (APA), 5
products/equipment and thereby interpretation, and it points to DOE’s
U.S.C. 551 et seq., provides among other past precedent related to space
precluding the distribution in commerce things, that ‘‘[e]ach agency shall give an
of non-condensing combustion constraints and differences in available
interested person the right to petition electrical power supply (and associated
technology products/equipment) and for the issuance, amendment, or repeal
withdraw the proposed energy installation costs) as supporting its call
of a rule.’’ (5 U.S.C. 553(e)) DOE to find that non-condensing technology
conservation standards for residential received a petition from the Gas
furnaces and commercial water heaters amounts to a performance-related
Industry Petitioners, as described in this
based upon such findings. Through this ‘‘feature.’’ Based upon these arguments,
notice and set forth verbatim below,
notice, DOE seeks comment on the the Gas Industry Petitioners conclude
requesting that DOE: (1) Issue an
petition, as well as any data or that DOE should issue an interpretive
interpretive rule stating that DOE’s
information that could be used in DOE’s rule treating non-condensing technology
proposed energy conservation standards
amozie on DSK3GDR082PROD with PROPOSALS1

determination whether to proceed with as a ‘‘feature’’ under EPCA, withdraw its
for residential furnaces and commercial
the petition. water heaters would result in the rulemaking proposals for both
DATES: Written comments and unavailability of ‘‘performance residential furnaces and commercial
information are requested on or before characteristics’’ within the meaning of water heaters, and proceed on the basis
January 30, 2019. the Energy Policy and Conservation Act of this revised interpretation.
ADDRESSES: Interested persons are of 1975 (42 U.S.C. 6291 et seq.; EPCA), DOE welcomes comments and views
encouraged to submit comments, as amended (i.e., by setting standards of interested parties on any aspect of the
identified by ‘‘Energy Conservation which can only be met by condensing petition for rulemaking.

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54884 Federal Register / Vol. 83, No. 212 / Thursday, November 1, 2018 / Proposed Rules

Submission of Comments documents via email, hand delivery, or generally known by or available from
DOE invites all interested parties to postal mail will also be posted to http:// other sources; (4) whether the
submit in writing by January 30, 2019 www.regulations.gov. If you do not want information has previously been made
comments and information regarding your personal contact information to be available to others without obligation
this petition. publicly viewable, do not include it in concerning its confidentiality; (5) an
Submitting comments via http:// your comment or any accompanying explanation of the competitive injury to
www.regulations.gov. The http:// documents. Instead, provide your the submitting person which would
www.regulations.gov webpage will contact information on a cover letter. result from public disclosure; (6) when
require you to provide your name and Include your first and last names, email such information might lose its
contact information prior to submitting address, telephone number, and confidential character due to the
comments. Your contact information optional mailing address. The cover passage of time, and (7) why disclosure
will be viewable to DOE Building letter will not be publicly viewable as of the information would be contrary to
Technologies staff only. Your contact long as it does not include any the public interest.
comments. It is DOE’s policy that all comments
information will not be publicly
Include contact information in your may be included in the public docket,
viewable except for your first and last
cover letter each time you submit without change and as received,
names, organization name (if any), and comments, data, documents, and other
submitter representative name (if any). including any personal information
information to DOE. If you submit via provided in the comments (except
If your comment is not processed postal mail or hand delivery, please
properly because of technical information deemed to be exempt from
provide all items on a CD, if feasible, in
difficulties, DOE will use this public disclosure).
which case it is not necessary to submit
information to contact you. If DOE printed copies. No telefacsimiles (faxes) DOE considers public participation to
cannot read your comment due to will be accepted. be a very important part of its process
technical difficulties and cannot contact Comments, data, and other for considering rulemaking petitions.
you for clarification, DOE may not be information submitted electronically DOE actively encourages the
able to consider your comment. should be provided in PDF (preferred), participation and interaction of the
However, your contact information Microsoft Word or Excel, WordPerfect, public during the comment period.
will be publicly viewable if you include or text (ASCII) file format. Provide Interactions with and between members
it in the comment or in any documents documents that are not secured, written of the public provide a balanced
attached to your comment. Any in English, and free of any defects or discussion of the issues and assist DOE
information that you do not want to be viruses. Documents should not include in determining how to proceed with a
publicly viewable should not be any special characters or any form of petition. Anyone who wishes to be
included in your comment, nor in any encryption, and, if possible, they should added to DOE mailing list to receive
document attached to your comment. carry the electronic signature of the future notices and information about
Persons viewing comments will see only author. this petition should contact Appliance
first and last names, organization Campaign form letters. Please submit and Equipment Standards Program staff
names, correspondence containing campaign form letters by the originating at (202) 287–1445 or via e-mail at
comments, and any documents organization in batches of between 50 to ApplianceStandardsQuestions@
submitted with the comments. 500 form letters per PDF or as one form ee.doe.gov.
Do not submit to http:// letter with a list of supporters’ names
www.regulations.gov information for Approval of the Office of the Secretary
compiled into one or more PDFs. This
which disclosure is restricted by statute, reduces comment processing and The Secretary of Energy has approved
such as trade secrets and commercial or posting time. publication of this notice of petition for
financial information (hereinafter Confidential Business Information. rulemaking.
referred to as Confidential Business Pursuant to 10 CFR 1004.11, any person
Signed in Washington, DC, on October 25,
Information (CBI)). Comments submitting information that he or she 2018.
submitted through http:// believes to be confidential and exempt
Kathleen B. Hogan,
www.regulations.gov cannot be claimed by law from public disclosure should
as CBI. Comments received through the submit via email, postal mail, or hand Deputy Assistant Secretary for Energy
Efficiency, Energy Efficiency and Renewable
website will waive any CBI claims for delivery two well-marked copies: one Energy.
the information submitted. For copy of the document marked
information on submitting CBI, see the ‘‘Confidential’’ including all the October 18, 2018
Confidential Business Information information believed to be confidential, BEFORE THE OFFICE OF ENERGY
section. and one copy of the document marked EFFICIENCY AND RENEWABLE
DOE processes submissions made ‘‘Non-confidential’’ with the ENERGY UNITED STATES
through http://www.regulations.gov information believed to be confidential DEPARTMENT OF ENERGY
before posting. Normally, comments deleted. Submit these documents via WASHINGTON, D.C.
will be posted within a few days of email or on a CD, if feasible. DOE will
being submitted. However, if large make its own determination about the Petition for Rulemaking
volumes of comments are being confidential status of the information Energy Conservation Program: Energy
processed simultaneously, your and treat it according to its Conservation Standards for Residential
amozie on DSK3GDR082PROD with PROPOSALS1

comment may not be viewable for up to determination. Furnaces
several weeks. Please keep the comment Factors of interest to DOE when
tracking number that http:// evaluating requests to treat submitted Docket Number EERE–2014–BT–STD–
www.regulations.gov provides after you information as confidential include: (1) 031; RIN No. 1904–AD20
have successfully uploaded your A description of the items; (2) whether Energy Conservation Program:
comment. and why such items are customarily
Submitting comments via email, hand treated as confidential within the Energy Conservation Standards for
delivery, or postal mail. Comments and industry; (3) whether the information is Commercial Water Heaters

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Document Created: 2018-11-01 01:05:31
Document Modified: 2018-11-01 01:05:31

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Proposed Rules
Action		Notice of petition for rulemaking; request for comment.
Dates		Written comments and information are requested on or before January 30, 2019.
Contact		Mr. Eric Stas, U.S. Department of Energy, Office of the General Counsel, 1000 Independence Avenue SW, Washington, DC 20585. Telephone: (202) 586-9507. E-mail: [email protected]
FR Citation		83 FR 54883
CFR Citation		10 CFR 430 10 CFR 431