DOE outlines possible enforcement options for Regional Standards

DOE outlines possible enforcement options
This morning the Department of Energy released a Framework document regarding enforcement of the newly installed regional standards. This document is intended to provide stakeholders with an idea of what the DOE may have in mind and allow for discussion, before an official enforcement proposal is released in January.

The DOE has stated that the effective dates (May 1, 2013 for furnaces and January 1, 2015 for air-conditioners) are installation bans, therefore eliminating "Grandfather" provisions that have marked previous standards increases and leaving distributors to liquidate inventory before the effective date or risk it being stranded.

Additionally, the DOE has laid out three different enforcement approaches that they are considering. All three approaches put unprecedented burdens on distributors and clearly represent why HARDI opposed this regulation in the first place.

• The "least invasive" proposal would mandate distributors to inform the purchaser of equipment of the regional standards and require a signature from the contractor which would indicate they understand the regional standards. This letter would then be kept under file by distributors.
• A second option would require the distributor to track serial numbers of equipment sold to contractors and maintain those records in the event of an audit by the federal government.
• The most aggressive proposal would require distributors to track serial number, installer, and installation location information for units sold and to submit the information on a regular basis or face penalty.

HARDI urges all members to read the DOE's Framework document and contact Jon Melchi with your thoughts and recommendations.

HARDI voices opposition to Regional Standards

HARDI files comments in opposition of Regional Standards/ Efficiency Standards Increase

On Monday HARDI filed comments in opposition to a Department of Energy (DOE) Direct Final Rule which would regionalize air conditioners and furnaces as well as increasing efficiency standards for those products in certain regions. The Direct Final Rule came as a result of a pact negotiated by equipment manufacturers and energy efficiency advocates and excluded the input of HVAC distributors and contractors. HARDI has asked the DOE to withdraw the direct final rule and precede with the traditional rulemaking (NOPR) process which would allow for more analysis and stakeholder input.

HARDI indicated in previous comments to DOE that we would only be able to offer support to the proposed rule if the planned increases in efficiency standards were economically justifiable. HARDI maintains that the nation’s economic climate, including an unprecedented drop in new home construction, coupled with the substantial decline in unitary sales of both air conditioners and furnaces since the last national standards and a reduction in consumer purchasing power do not make the proposed rule viable on an economic level.

Additionally, HARDI has great concerns about the unknown costs that will come with compliance and enforcement of the proposed rule. HARDI believes that it is impossible for the DOE to fully assess the economic impact of the rule without first finalizing an enforcement plan. HARDI fears that the cost and responsibility associated with compliance and enforcement will fall far from the manufacturers who negotiated the agreement, and will land squarely upon the many small businesses in both the HVAC distribution and contract installation industry. HARDI has asked the DOE withdraw the direct final rule and move the rule to a NOPR with a combined, or concurrent, enforcement rulemaking.

Carrier Petition to EPA to Stop "Dry-Shipped" Stirring the Pot

The NEWS' story this week announcing Carrier Corps petition filed with the EPA to reclassify condensing units as "subsystems" and therefore make the manufacturer of "dry-shipped" R-22 condensing units illegal has really fired up some in the industry. Check out the comments posted in response to The NEWS article. Anyone who still thinks these "dry-shipped" units are going to be an insignificant percentage of total shipments is either selling R-410a or in the window-banger business. By the way, HARDI had been asked to provide comment for the article but we do not have a formal position yet on Carrier's petition.

DOE issues Direct Final Rule on Regional Standards

The Department of Energy has released a Direct Final Rule regarding Regional Standards for Residential Furnaces, Residential Central Air Conditioners and Heat Pumps. If no adverse comments are received, this Direct Final Rule will become effective 110 days from the date of official publication and will be followed 90 days later by an enforcement rulemaking.

As currently written, the implementation date for non-weatherized gas furnaces, mobile home furnaces and non-weatherized oil furnaces is May 1, 2013. The implementation date for weatherized gas furnaces, all central air conditioners and all heat pumps is January 1, 2015.

The DOE has decided to leave a singular national standard in place for some products, while other products will now be forced to meet up to three different qualifying standards. Below is a list of both national product standards and a breakdown by individual state.

Product Class	National Standard
Non-weatherized oil-fired furnace	83% AFUE
Weatherized gas furnace	81% AFUE
Mobile home oil-fired furnace	75 % AFUE
Weatherized oil-fired furnace	78% AFUE
Electric furnace	78% AFUE
Split-system heat pumps	14 SEER / 8.2 HSPF
Single-package heat pumps	14 SEER/ 8.0 HSPF
Small-duct, high velocity systems	13 SEER/ 7.7 HSPF
Space-constrained products- air conditioner	12 SEER
Space-constrained products- heat pumps	12 SEER/ 7.4 HSPF

States	Non-weatherized gas furnace	Mobile home gas furnace	Split-system AC	Single-package AC
AK, CO, CT, ID, IL, IN, IA, KS, ME, MA, MI, MN, MO, MT, NE, NH, NJ, NY, ND, OH, OR, PA, RI, SD, UT, VT, WA, WV, WI, WI	90% AFUE	90% AFUE	13 SEER	14 SEER
AL, AR, DE, FL, GA, HI, KY, LA, MD, MS, NC, OK, SC, TN, TX, VA, DC	80% AFUE	80% AFUE	14 SEER	14 SEER
AZ, CA, NV, NM	80 % AFUE	80% AFUE	14 SEER EER=12.2 >45,000 BTU's EER=11.7 <45,000 BTU's	14 SEER EER=11.0

Home Performance w/ ENERGY STAR Moving to DOE

The Home Performance with ENERGY STAR program for energy efficient whole-home residential retrofits that has resided at U.S. EPA since its inception is moving to U.S. DOE. As EPA funding come increasingly under attack by Congress, it is believed the move is being made so more resources will be available to the growing program. Home Performance with ENERGY STAR is hosting a stakeholder meeting on April 13 in Washington, DC to review the move and transition in more detail with stakeholders. For the formal release about the transition, click here.

HARDI Expresses Concerns Over New Energy Star Furnace Specs

Just posted to HARDI's website, HARDI filed comments with U.S. Environmental Protection Agency (EPA) ENERGY STAR program on the latest draft of proposed specifications for the next generation of residential furnace's labeling program. Think regionalization and take a guess at the majority of our concerns.

The NEWS: DOE to Provide $7mil to 24 States to Update Energy Codes

If you've not seen this article from The NEWS, you need to. ARRA (the stimulus bill) provided the U.S. Department of Energy (DOE) with funds to use as a carrot and stick to states to adopt and enforce more stringent building energy codes (IECC for residential, ASHRAE 90.1 for commercial). For many states, and now 24 more, the time to debate whether the more stringent energy codes are reasonable, attainable, or justified has passed, and now it's up to our industry to figure out how to live with them (and not allow another California Title 24-ish disaster to occur). If you're not closely tied into your state(s)' energy offices, code officials, etc., you had better find a way to do so quickly...especially in these 24 states.

Missing the Forest Through the "Dry-Shipped" Trees

Yesterday HARDI filed comments with the U.S. Dept. of Energy (DOE) on their proposed guidance for certifying newly-produced R-22 residential condensing units. DOE proposed two paths that would essentially pave the way for the installation of mis-matched condensing units, and it was this apparent reversal in decades of precedent that is the point; a point that I fear most in our industry may be missing. While the recent reintroduction of "dry-shipped" R-22 condensing units (due to the way EPA's 2010 HCFC Phaseout Regulations were written which I still consider a loophole) is the talk of the HVAC community right now, DOE's proposed certification procedures for these units is the real story. If unchanged, DOE's guidance is essentially signaling knowing consent that these condensing units will be installed with unmatched indoor coils. This is drastically different than DOE's matched system certifications for any other newly-produced split system based on the assumption that both the indoor and outdoor equipment will be installed at the same time. Instead DOE is proposing a blatant gaming of the test procedure system far detached from reality.

While our industry has invested resources to promote, support, and advocate the value of properly matched system installations, this one DOE ruling could undermine all of it with one bureacratic swoop. Either our industry is based on matched, split-system cooling or it isn't. Either our industry delivers the performance listed on hang tags or it doesn't. This isn't a refrigerant issue, this is a glimpse into our future. Either we support and defend our current matched system certification process or we abandon it because there is no way we can have it both ways for long. R-22, R-410a, or whatever the next refrigerant coursing through our split systems is isn't the point. Ensuring those split systems are properly matched and running as advertised is, which is why HARDI cannot support DOE's proposed endorsement of improper installations.

DOE Ceases Sales of Air Con Int'l Air Conditioners

The Department has issued a Notice of Noncompliance Determination and Proposed Civil Penalty to Air-Con, International, requiring Air-Con to cease the sale of certain air-conditioning systems in the United States and proposing a civil penalty of $231,090 for sales of these products in violation of the applicable energy efficiency standards. This action reflects the Department’s continued commitment to act aggressively to remove unlawful products from the market. See the Department of Energy's Office of General Counsel full release here.

ACCA and Others Seek Improvements to Home Star

According to ACCA's official release, the HVACR contractor association has joined with the Green Mechanical Council, the National Association of Home Builders, the National Lumber and Building Material Dealers Association, the National Roofing Contractors Association, and the Plumbing-Heating-Cooling Contractors National Association on a letter to the Senate urging two primary improvements to the latest "Home Star" bill:

1. Redirect the rebates to homeowners rather that to contractors
2. Open up "Gold Star" and the parallel 25E tax credit to more than BPI Accredited contractors

The bill faced signficant challenges prior to the concerns raised by these six influential organizations. Whether these changes are made might not matter since there continues to be little agreement on how to pay for the $6 billion program. HARDI agrees that opening up the contractor eligibility is essential for passage of the bill, however passage of an unappropriated Home Star could be far more disruptive and costly on the industry than no passage at all.

Follow Up to DOE Enforcement Post re: ADP

Just received from ADP regarding yesterday's DOE enforcement action:

Advanced Distributor Products (ADP) Responds to Department of Energy (DOE) Notice of Noncompliance Determination

On June 3rd, 2010, the DOE issued a press release stating two heat pump models manufactured by ADP fail to meet applicable federal energy conservation standards. ADP currently has over 86,000 active energy conservation standards listings. Through a database entry error, ADP incorrectly listed these two heat pumps (both inactive R-22 units) referenced by the DOE as noncompliant. The errors have been corrected and in fact, both units were compliant at all times with applicable federal energy conservation standards. ADP fully stands behind the integrity of its certification and rating process.

DOE Takes Action Against 3 HVAC Manufacturers

Aspen, Summit, and ADP had a total of 62 matched air-conditioning and heat pump certifications suspended yesterday and were issued immedate sales and distribution prohibitions by the U.S. Department of Energy yesterday. Here's the agency's complete release.

HARDI Calls on House to Pass Improved Home Star Bill

HARDI sent this letter to all House of Representatives’ offices last night urging passage of an amended H.R. 5019, The Home Star Retrofit Act of 2010. Earlier this week HARDI had circulated throughout the House two significant concerns with the legislation which the association believe unnecessarily restricted contractor access to Home Star’s $6 billion in residential energy efficiency retrofit funding. HARDI was able to work with key members of Congress to get an amendment to the bill included in a package of amendments that will be voted on today along with the bill in its entirety. The primary amendment presented by Congresswoman Herseth-Sandlin of South Dakota will require the U.S. Department of Energy to review and approve alternative proposals to BPI Accreditation to enable qualified contractors to offer Gold Star, home performance retrofits. Should this important legislation pass the House today, the bill would move to the Senate where HARDI is confident it can continue to work with key stakeholders and legislators to iron out minor remaining concerns.

HARDI Urges DOE to Not Undermine Energy Efficiency Incentives

HARDI submitted these comments to the U.S. Department of Energy for two rulemakings evaluating the minimum appliance standards for residential furnaces, central air-conditioners, and heat pumps. Expressing concerns over the negative impact an increase in minimum standards, or their regionalization, could have on the growing energy efficiency programs that have become such a vital driver for high-efficiency HVAC installations, HARDI questions DOE assumptions that an increase in minimum standards would have minimum impact on the HVAC industry and consumers.

More From SC's Appliance Rebate Program: Over 2,000 Heat Pumps Sold!!

Here's the official announcement from South Carolina outlining how the HVAC industry was able to exhaust the program's funds in just 30 hours by selling over 4,000 HVAC and water heating products...and all this while there's still over $1 mil available for white goods. Once again our industry proves how fast we can mobilize to save energy.

Told You States: HVAC Was the Way to Go

Thanks to ACCA's Kevin Holland for finding this article outlining how HVAC contractors have been far more successful than white good retailers so far in implementing South Carolina's Appliance Rebate Program. Many states told HARDI they really wanted to focus their programs on high-efficiency HVAC systems but they didn't know how they'd administer the program and were unsure how quickly professionally-installed products could be deployed. We were able to convince a few states to give it a shot and those states that listened look to be reaping the benefits!

DOE Finalizes New Efficiency Standards for Residential Water Heaters

The DOE announced the publication of a final rule yesterday for more stringent efficiency standards for residential water heaters. The new standards for water heaters take effect five years from yesterday while new standards for some direct heating and pool heating equipment covered by the rule become effective in three years. Of note is the requirement for larger residential water heaters to be either heat pump equipped if electric or condensing if gas by the effective date. You can read the final rule here.

A Glimpse Into the Challenges of Regional Standards

The US Dept. of Energy has started its re-review of the federal energy conservation standards for residential gas furnaces, which now includes authority to establish regional standards, by issuing this Rulemaking Analysis Plan. In it, DOE devotes a section to consider how regionalized efficiency standards could be enforced. Below are DOE's eight initial regional standards enforcement considerations which HARDI is working with AHRI and ACCA to respond to:

1. appropriate modifications to appliance labels to indicate in which regions of the country specific products are allowed to be installed;
2. requirements that marketing literature for systems clearly indicate in which regions a product could be legally installed;
3. encouraging state and local entities to adopt these regional standards in building codes and to provide reference to the required minimum efficiencies in required mechanical or electrical permits;
4. encouraging states who have regional appliance standards to adopt and codify the appropriate regional standards enacted by DOE;
5. providing that installations that don’t meet regional standards could result in installers being subject to fines for each occurrence;
6. requirements to certify compliance of installations through warranty registration or other registration means;
7. an informational program so that consumers are made aware of any regional standards, what to look for in purchasing products, and what implications there would be for improper installation; and
8. competitively driven enforcement where manufacturers/distributors/contractors report
   other manufacturers/distributors/contractors whose actions result in installations not in
   compliance with Federal standards.

ASHRAE Seeks Comments on Improvements to 90.1

Reported by ACHR News: "The American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) has announced that public input to help shape the technical requirements in Standard 90.1 is being sought through 21 proposed addenda, which could become part of the 2010 version of the standard.

ANSI/ASHRAE/IESNA Standard 90.1-2007, Energy Standard for Buildings Except Low-Rise Residential Buildings, provides minimum requirements for the energy-efficient design of buildings except low-rise residential buildings. The proposed addenda cover a range of topic areas, including daylighting, air leakage, EER and IEER values, and requirements for VRF air conditioners and heat pumps."

Obama Visits HVAC School to Discuss HOMESTAR Incentive

The President is in Savannah, GA today at the Savannah Technical College where he'll outline the framework of a HOMESTAR program intended to incentivize more comprehensive residential energy efficiency improvements. Primarily led by AHRI, the industry has been working with the Senate to get this program in energy or jobs legislation this spring.