U.S. DOE Rulemakings Show Impacts on NEMA Member Companies

U.S. DOE Rulemakings Show Impacts on NEMA Member Companies

This piece was originally published in the March/April 2020 issue of electroindustry.

by Alex Boesenberg, Senior Manager of Regulatory Affairs, NEMA

The Office of Information and Regulatory Affairs (OIRA), an important subordinate entity within the White House Office of Management and budget (OMB), recently published1 its final report on the national impacts of significant rulemakings by Federal agencies from 2006 to 2016. Federal law mandates that OMB review any proceedings that may involve an estimated economic impact (benefit or cost) of approximately $100 million.

This NEMA-focused staff analysis looks at the major rulemakings of the U.S. Department of Energy (DOE) as compared to other trade associations and regulated entities. The DOE publishes several rules each year that directly impact how products and appliances are constructed and how they perform.

In the report, OMB catalogs and summarizes 85 published “major” rules of several agencies, the DOE included. This report focuses on DOE minimum energy conservation Standard rules, which dictate the performance requirements of both commercial and consumer components and finished goods/systems. For the sake of brevity,  this summary addresses only those rules involving estimated benefits (energy savings) of at least $1 billion. All monetary figures given herein are taken from the OMB report, which tables all financial figures in 2001 dollars.

Some notes and findings:

  • Of the 22 major rules identified in the report, NEMA Member products account for nine of these milestones; the closest trade association siblings (AHRI and AHAM) had six and five, respectively.
  • For rulemakings involving greater than $1 billion (2001) energy savings, an estimated total national benefit of approximately $10.87-$19.12 billion was forecast, of which NEMA Member product rules account for $4.9-$12.1 billion—more than half of national energy savings estimates.
  • For rulemakings involving greater than $1 billion (2001) energy savings, an estimated total national cost of approximately $4.1-$5.7 billion was forecast, of which NEMA Member product rules account for $1.5-$2.3 billion of these estimates—a little less than half of total national costs.

Importantly, a final rule is almost always  preceded by three to four milestone events and documentation, all requiring review, analysis, and public comments from stakeholders. Thus, for every DOE rule (typically taking between three and five years to complete), NEMA must comment two or three times for each rule. Considering a product class needs a Federal test procedure to be examined for minimum energy conservation Standards potential, every product class involves two rulemaking sequences. This is not clearly captured in the Office of Information and Regulatory Affairs summary.

One may readily deduce that since NEMA Member products are impacted by nearly 50 percent of all major rules, NEMA Members have borne the brunt of DOE regulatory responsibility in terms of cost of compliance and energy saved.

The study shows that the electroindustry has proven it meets the spirit as well as the letter of the law, especially where energy efficiency is involved. Collectively, we should be proud of our contributions to the national benefit. NEMA is proud of our Members’ commitment to participation in, and compliance with, energy conservation Standards. ei

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1 https://www.whitehouse.gov/wp-content/uploads/2019/12/2019-CATS-5885- REV_DOC-2017Cost_BenefitReport11_18_2019.docx.pdf

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