STANDARD LIGHT BULBS AND THE RULE OF LAW (PART ONE)

STANDARD LIGHT BULBS AND THE RULE OF LAW (PART ONE)

Our friends in the energy efficiency advocacy community have raised their voice recently contending that the Administration is poised to curtail energy savings from more efficient light bulbs by wrongfully saving certain incandescent light bulbs from regulatory extinction.

NEMA filed a petition to review a Department of Energy (DOE) rule in March 2017 that addressed this issue; therefore, we have something to say about that.

Our objective in filing the lawsuit was simple: to get a court to order DOE to adhere to the text of the Energy Independence and Security Act (EISA) enacted by Congress in 2007 that authorized DOE, among other things, to amend or adopt energy conservation standards for various types of “general-service lamps,” which are the standard light bulbs that come in four technological flavors: incandescent, compact fluorescent, and now light-emitting diode (LED) and induction.

Why did NEMA appeal the DOE rule? Because the Department issued a rule that vastly expanded the types of lamps to be regulated beyond the standard light bulb to include specialty lamps with unusual lamp bases that do not fit in a standard “medium” screw base socket, lamps that operate at non-standard voltages, lamps that narrowly focus a beam of light on a small area and do not provide “omnidirectional” lighting like a standard light bulb provides, lamps that operate only at low wattages and provide very low light output instead of the wide range of light outputs that standard light bulbs provide, and a host of other niche lighting products that are not used in lighting applications served by the standard incandescent lamp. The DOE’s rule redefining general-service lamps was a regulatory expansion that relied upon an interpretation of Congress’s text that, in our view, can only be described as legally erroneous. In the development of its final rule, DOE also declined to consider facts about these lamps that were relevant to this issue.

To its credit, the DOE agreed it would look at these facts and NEMA’s legal argument and reconsider whether it had made a mistake or not. NEMA’s appeal was settled. No promises were made that the outcome would change, but a serious case was presented that would warrant the Department’s reconsideration. NEMA’s legal arguments about the correct interpretation of the statute are a matter of public record. If the DOE agreed with most or all of these arguments about what types of light bulbs are subject to regulation as general-service lamps, the Department would not be backsliding on energy efficiency as our friends have claimed: the Government cannot backslide from a point they could not legally stand upon in the first place. To think otherwise would erode the rule of law and the primacy of Congress in writing our laws. What DOE is now doing, in part, is deciding whether or not its prior rule defining general-service lamps violated the law it has authority to implement.

DOE agreed to resume the general-service lamp rulemaking and make various determinations about what energy conservation standards should apply to general-service light bulbs. In its January 2017 rule redefining general-service lamps, DOE intimated that maybe it had no more work to do determining whether to amend or adopt energy conservation standards for these lamps despite the fact that Congress said DOE “shall” do just that. Again, NEMA is asking DOE to adhere to the text of the statute enacted by Congress in 2007.

In the meantime, the marketplace is already realizing significant energy savings as consumers rapidly transition to more efficient general-service light bulbs before any regulation is effective.   In this same 2007 legislation, Congress indicated that it expected that whatever determinations DOE made with respect to energy conservation standards for the various types of general-service lamp (including possibly making no changes in standards for general-service incandescent lamps if that could not be justified), DOE’s standards should produce energy savings that are greater than or equal to the energy consumed by a 45 lumens per watt lamp in every socket. If DOE’s rule failed to produce these energy savings, Congress directed the Secretary of Energy to ban the sale of lamps that failed to meet a 45 lumen per watt standard by January 1, 2020. This is referred to as the “backstop” provision, a term which the dictionary defines as a “last resort.” The backstop could also be triggered if the DOE determined that standards in effect for general-service incandescent lamps should be amended and failed to publish a final rule by January 1, 2017. DOE has not yet determined that standards in effect for general-service incandescent lamps should or should not be amended. If DOE determines that they cannot be amended because such standards are not technologically feasible or economically justified, then the January 1, 2017, deadline is irrelevant and the sales ban is not triggered provided that the above-described energy savings requirement is met. A report recently published by ICF succinctly summarizes the regulatory status of the pending proceeding.

A preliminary analysis submitted to the rulemaking record by NEMA in early 2016 showed that the marketplace was likely to meet that energy savings goal without amending general service incandescent lamp standards. More recent data now available demonstrates that NEMA’s preliminary analysis was conservative. 2018 year-to-date data indicate that domestic sales of more energy-efficient, general-service LED lamps appear to be headed toward exceeding domestic sales of general-service incandescent lamps and CFLs by approximately two-to-one by the end of the year. Sales of general-service LEDs will exceed sales of CFLs and incandescent light bulbs. And while sales of CFLs are shrinking dramatically, the substantial installed base of CFLs and LEDs is generating energy savings for the class of general-service lamps in sockets (including the halogen incandescent lamps) beyond what a 45 lumen per watt lamp in every socket would generate.

What this marketplace development signifies is that there is not a market failure problem that requires a heavy governmental regulatory hand here. Lighting manufacturers and consumers have brought about a significant transformation in energy savings without heavy government regulation. A sales ban for general-service incandescent lamps effective on January 1, 2020, on the other hand, does present a host of problems for retailers, consumers and manufacturers. It would be a perverse interpretation of the statute’s backstop clause to conclude that the statutory “last resort” was triggered when Congress’s energy savings goals are met. DOE needs to examine this issue and reach an interpretation of EISA that is not at war with itself.

The questions of 1) the proper definition of a general-service lamp, 2) whether to amend or not to amend general-service incandescent lamp standards, 3) whether to end exemptions for certain incandescent lamps, 4) whether or not to adopt a 45 lumen per watt standard for general-service lamps or a sales ban in 2020, or 5) whether to adopt standards for general-service LED lamps or amend standards for CFLs are all pending in the ongoing DOE rulemaking. Congress directed the Secretary of Energy to make these decisions, and we expect to see these decisions forthcoming in the coming weeks and months.

 

 


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