Energy Conservation Program: Energy Conservation Standards for Consumer Clothes Dryers

This document, concerning Consumer Clothes Dryers is an action issued by the

Department of Energy. Though it is not intended or expected, should any discrepancy

occur between the document posted here and the document published in the Federal

available through the Internet solely as a means to facilitate the public's access to this

document.

[6450-01-P]

DEPARTMENT OF ENERGY

10 CFR Part 430

[EERE-2014-BT-STD-0058]

RIN 1904-AF59

Energy Conservation Program: Energy Conservation Standards for Consumer

Clothes Dryers

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

ACTION: Direct final rule.

SUMMARY: The Energy Policy and Conservation Act, as amended (“EPCA”),

prescribes energy conservation standards for various consumer products and certain

commercial and industrial equipment, including consumer clothes dryers. In this direct

final rule, DOE is adopting amended energy conservation standards for consumer clothes

dryers. DOE has determined that the amended energy conservation standards for these

products would result in significant conservation of energy and are technologically

feasible and economically justified.

DATES: The effective date of this rule is [INSERT DATE 120 DAYS AFTER DATE

OF PUBLICATION IN THE FEDERAL REGISTER]. If adverse comments are

received by [INSERT DATE 110 DAYS AFTER DATE OF PUBLICATION IN

THE FEDERAL REGISTER] and DOE determines that such comments may provide a

reasonable basis for withdrawal of the direct final rule under 42 U.S.C. 6295(o), a timely

withdrawal of this rule will be published in the Federal Register. If no such adverse

comments are received, compliance with the amended standards established for consumer

clothes dryers in this direct final rule is required on and after March 1, 2028. Comments

regarding the likely competitive impact of the standards contained in this direct final rule

should be sent to the Department of Justice contact listed in the ADDRESSES section on

or before [INSERT DATE 30 DAYS AFTER DATE OF PUBLICATION IN THE

FEDERAL REGISTER].

ADDRESSES: The docket for this rulemaking, which includes Federal Register notices,

public meeting attendee lists and transcripts, comments, and other supporting

documents/materials, is available for review at www.regulations.gov. All documents in

the docket are listed in the www.regulations.gov index. However, not all documents

listed in the index may be publicly available, such as information that is exempt from

public disclosure.

The docket webpage can be found at www.regulations.gov/docket/EERE-2014-

BT-STD-0058. The docket webpage contains instructions on how to access all

documents, including public comments, in the docket.

For further information on how to submit a comment or review other public

comments and the docket, contact the Appliance and Equipment Standards Program staff

at (202) 287-1445 or by email: [email protected].

The U.S. Department of Justice Antitrust Division invites input from market

participants and other interested persons with views on the likely competitive impact of

the standards contained in this direct final rule. Interested persons may contact the

Antitrust Division at [email protected] on or before the date specified in the

DATES section. Please indicate in the “Subject” line of your email the title and Docket

Number of this direct final rule.

FOR FURTHER INFORMATION CONTACT:

Dr. Carl Shapiro, U.S. Department of Energy, Office of Energy Efficiency and

Renewable Energy, Building Technologies Office, EE-5B, 1000 Independence Avenue,

SW, Washington, DC, 20585-0121. Telephone: (202) 287-5649. Email:

ApplianceStandar[email protected]oe.gov.

Mr. Matthew Schneider, U.S. Department of Energy, Office of the General

Counsel, GC-33, 1000 Independence Avenue, SW, Washington, DC, 20585-0121.

Telephone: (240) 597-6265. Email: [email protected].

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Synopsis of the Direct Final Rule

A. Benefits and Costs to Consumers

B. Impact on Manufacturers

C. National Benefits and Costs

D. Conclusion

II. Introduction

A. Authority

B. Background

1. Current Standards

2. Current Test Procedure

3. The Joint Agreement

III. General Discussion

A. Scope of Coverage

B. Fairly Representative of Relevant Points of View

C. Technological Feasibility

1. General

2. Maximum Technologically Feasible Levels

D. Energy Savings

1. Determination of Savings

2. Significance of Savings

E. Economic Justification

1. Specific Criteria

a. Economic Impact on Manufacturers and Consumers

b. Savings in Operating Costs Compared to Increase in Price (LCC and PBP)

c. Energy Savings

d. Lessening of Utility or Performance of Products

e. Impact of Any Lessening of Competition

f. Need for National Energy Conservation

g. Other Factors

2. Rebuttable Presumption

IV. Methodology and Discussion of Related Comments

A. Market and Technology Assessment

1. Product Classes

2. Technology Options

B. Screening Analysis

1. Screened Out Technologies

a. Thermoelectric heating, electric only

b. Microwave, electric only

c. Indirect heating

d. RF drying, electric only

e. Ultrasonic drying, electric only

2. Remaining Technologies

C. Engineering Analysis

1. Efficiency Analysis

a. Baseline Efficiency Levels

b. Incremental Efficiency Levels

2. Cost Analysis

3. Cost-Efficiency Results

D. Markups Analysis

E. Energy Use Analysis

F. Life-Cycle Cost and Payback Period Analysis

1. Product Cost

2. Installation Cost

3. Annual Energy Consumption

4. Energy Prices

5. Maintenance and Repair Costs

6. Product Lifetime

7. Discount Rates

8. Energy Efficiency Distribution in the No-New-Standards Case

9. Payback Period Analysis

G. Shipments Analysis

H. National Impact Analysis

1. Product Efficiency Trends

2. National Energy Savings

3. Net Present Value Analysis

I. Consumer Subgroup Analysis

J. Manufacturer Impact Analysis

1. Overview

2. Government Regulatory Impact Model and Key Inputs

a. Manufacturer Production Costs

b. Shipments Projections

c. Capital and Product Conversion Costs

d. Manufacturer Markup Scenarios

3. Discussion of MIA Comments

K. Emissions Analysis

1. Air Quality Regulations Incorporated in DOE’s Analysis

L. Monetizing Emissions Impacts

1. Monetization of Greenhouse Gas Emissions

a. Social Cost of Carbon

b. Social Cost of Methane and Nitrous Oxide

c. Sensitivity Analysis Using Updated 2023 SC-GHG Estimates

2. Monetization of Other Emissions Impacts

M. Utility Impact Analysis

N. Employment Impact Analysis

O. Regulatory Impact Analysis

P. Other Comments

V. Analytical Results and Conclusions

A. Trial Standard Levels

B. Economic Justification and Energy Savings

1. Economic Impacts on Individual Consumers

a. Life-Cycle Cost and Payback Period

b. Consumer Subgroup Analysis

c. Rebuttable Presumption Payback

2. Economic Impacts on Manufacturers

a. Industry Cash Flow Analysis Results

b. Direct Impacts on Employment

c. Impacts on Manufacturing Capacity

d. Impacts on Subgroups of Manufacturers

e. Cumulative Regulatory Burden

3. National Impact Analysis

a. Significance of Energy Savings

b. Net Present Value of Consumer Costs and Benefits

c. Indirect Impacts on Employment

4. Impact on Utility or Performance of Products

5. Impact of Any Lessening of Competition

6. Need of the Nation to Conserve Energy

7. Other Factors

8. Summary of Economic Impacts

C. Conclusion

1. Benefits and Burdens of TSLs Considered for Consumer Clothes Dryer

Standards

2. Annualized Benefits and Costs of the Adopted Standards

VI. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866, 13563 and 14094

B. Review Under the Regulatory Flexibility Act

C. Review Under the Paperwork Reduction Act

D. Review Under the National Environmental Policy Act of 1969

E. Review Under Executive Order 13132

F. Review Under Executive Order 12988

G. Review Under the Unfunded Mandates Reform Act of 1995

H. Review Under the Treasury and General Government Appropriations Act, 1999

I. Review Under Executive Order 12630

J. Review Under the Treasury and General Government Appropriations Act, 2001

K. Review Under Executive Order 13211

L. Information Quality

M. Congressional Notification

VII. Approval of the Office of the Secretary

Synopsis of the Direct Final Rule

The Energy Policy and Conservation Act, Public Law 94-163, as amended

(“EPCA”),

authorizes DOE to regulate the energy efficiency of a number of consumer

All references to EPCA in this document refer to the statute as amended through the Energy Act of 2020,

Pub. L. 116-260 (Dec. 27, 2020), which reflect the last statutory amendments that impact Parts A and A-1

of EPCA.

products and certain industrial equipment. (42 U.S.C. 6291–6317) Title III, Part B of

EPCA

established the Energy Conservation Program for Consumer Products Other Than

Automobiles. (42 U.S.C. 6291–6309) These products include consumer clothes dryers,

the subject of this direct final rule. (42 U.S.C. 6292(a)(7))

Pursuant to EPCA, any new or amended energy conservation standard must,

among other things, be designed to achieve the maximum improvement in energy

efficiency that DOE determines is technologically feasible and economically justified.

(42 U.S.C. 6295(o)(2)(A)) Furthermore, the new or amended standard must result in

significant conservation of energy. (42 U.S.C. 6295(o)(3)(B))

In light of the above and under the authority provided by 42 U.S.C. 6295(p)(4),

DOE is issuing this direct final rule amending energy conservation standards for

consumer clothes dryers.

The adopted standard levels in this direct final rule were proposed in a letter

submitted to DOE jointly by groups representing manufacturers, energy and

environmental advocates, consumer groups, and a utility. This letter, titled “Energy

Efficiency Agreement of 2023” (hereafter, the “Joint Agreement”

), recommends specific

energy conservation standards for consumer clothes dryers that, in the commenters’ view,

would satisfy the EPCA requirements in 42 U.S.C. 6295(o). DOE subsequently received

letters of support from States—including New York, California, and Massachusetts

—

For editorial reasons, upon codification in the U.S. Code, Part B was redesignated Part A.

Available at www.regulations.gov/comment/EERE-2014-BT-STD-0058-0055.

Available at www.regulations.gov/comment/EERE-2014-BT-STD-0058-0056.

and utilities—including San Diego Gas and Electric (“SDG&E”) and Southern California

Edison (“SCE”)

—advocating for the adoption of the recommended standards.

In accordance with the direct final rule provisions at 42 U.S.C. 6295(p)(4), DOE

has determined that the recommendations contained in the Joint Agreement are compliant

with 42 U.S.C. 6295(o). As required by 42 U.S.C. 6295(p)(4)(A)(i), DOE is also

simultaneously publishing elsewhere in this Federal Register a notice of proposed

rulemaking (“NOPR”) that contains standards identical to those adopted in this direct

final rule. Consistent with the statute, DOE is providing a 110-day public comment

period on the direct final rule. (42 U.S.C. 6295(p)(4)(B)) If DOE determines that any

comments received provide a reasonable basis for withdrawal of the direct final rule

under 42 U.S.C. 6295(o) or any other applicable law, DOE will publish the reasons for

withdrawal and continue the rulemaking under the NOPR. (42 U.S.C. 6295(p)(4)(C)) See

section II.A of this document for more details on DOE’s statutory authority.

The amended standards that DOE is adopting in this direct final rule are the

efficiency levels recommended in the Joint Agreement (shown in Table I.1). The

standards are expressed in terms of the combined energy factor (“CEF

”), measured in

pounds per kilowatt-hour (“lb/kWh”), as determined in accordance with DOE’s consumer

clothes dryer test procedure at title 10 of the Code of Federal Regulations (“CFR”) part

430, subpart B, appendix D2 (“appendix D2”). The CEF metric includes active mode,

standby mode, and off mode energy use. The amended standards recommended in the

Available at www.regulations.gov/comment/EERE-2014-BT-STD-0058-0057.

Joint Agreement are represented as trial standard level (“TSL”) 3 (hereinafter the

“Recommended TSL”) and are described in section V.A of this document. The Joint

Agreement’s standards for consumer clothes dryers apply to all products listed in Table

I.1 and manufactured in, or imported into, the United States starting on March 1, 2028.

Table I.1 Energy Conservation Standards for Consumer Clothes Dryers

(Compliance Starting March 1, 2028)

Product Class

Minimum CEF

(lb/kWh)

(i) Electric, Standard (4.4 cubic feet (“ft3”) or greater capacity)

3.93

(ii) Electric, Compact (120 volts (“V”)) (less than 4.4 ft3 capacity)

4.33

(iii) Vented Electric, Compact (240V) (less than 4.4 ft3 capacity)

3.57

(iv) Vented Gas, Standard (4.4 ft3 or greater capacity)

3.48

(v) Vented Gas, Compact (less than 4.4 ft3 capacity)

2.02

(vi) Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity)

2.68

(vii) Ventless Electric, Combination Washer-Dryer

2.33

A. Benefits and Costs to Consumers

Table I.2 summarizes DOE’s evaluation of the economic impacts of the adopted

standards on consumers of consumer clothes dryers, as measured by the average life-

cycle cost (“LCC”) savings and the simple payback period (“PBP”).

The average LCC

savings are positive for all product classes, and the PBP is less than the average lifetime

of consumer clothes dryers, which is estimated to be 14 years (see section IV.F of this

document).

The average LCC savings refer to consumers that are affected by a standard and are measured relative to

the efficiency distribution in the no-new-standards case, which depicts the market in the compliance year in

the absence of new or amended standards (see section IV.F.9 of this document). The simple PBP, which is

designed to compare specific efficiency levels, is measured relative to the baseline product (see section

IV.C of this document).

Table I.2 Impacts of Adopted Energy Conservation Standards on Consumers of

Consumer Clothes Dryers

Consumer Clothes Dryer Class

Average LCC Savings

(2022$)

Simple Payback Period

(years)

Electric, Standard (4.4 ft

greater capacity)

$252

0.6

Electric, Compact (120V) (less

than 4.4 ft

capacity)

$66 2.2

Vented Electric, Compact (240V)

(less than 4.4 ft

capacity)

$90 2.0

Vented Gas, Standard (4.4 ft

greater capacity)

$102 1.9

Ventless Electric, Compact

(240V) (less than 4.4 ft

capacity)

$99 0.4

Ventless Electric, Combination

Washer-Dryer

$11 0.0

DOE’s analysis of the impacts of the adopted standards on consumers is described

in section IV.F of this document.

B. Impact on Manufacturers

The industry net present value (“INPV”) is the sum of the discounted cash flows

to the industry from the base year (2024) through the end of the analysis period, which is

30 years from the analyzed compliance date.

Using a real discount rate of 7.5 percent,

DOE estimates that the INPV for manufacturers of consumer clothes dryers in the case

without amended standards is $2.12 billion in 2022$.

Under the adopted standards,

which align with the Recommended TSL for consumer clothes dryers, DOE estimates the

change in INPV to range from -6.8 percent to -5.7 percent, which is a decrease of

DOE’s analysis period extends 30 years from the compliance year. The analysis period for the MIA

ranges from 2024–2056 for the no-new-standards case and all TSLs, except for TSL 3 (the Recommended

TSL). The analysis period for the Recommended TSL ranges from 2024–2057 due to the 2028 compliance

year.

The no-new-standards case INPV of $2.12 billion reflects the sum of discounted free cash flows from

2024–2056 (from the reference year to 30 years after the 2027 compliance date) plus a discounted terminal

value.

approximately $144.2 million to a decrease of approximately $119.7 million. In order to

bring products into compliance with amended standards, it is estimated that industry will

incur total conversion costs of $180.7 million.

DOE’s analysis of the impacts of the adopted standards on manufacturers is

described in section IV.J and section V.B.2 of this document.

C. National Benefits and Costs

DOE’s analyses indicate that the adopted energy conservation standards for

consumer clothes dryers would save a significant amount of energy. Relative to the case

without amended standards, the lifetime energy savings for consumer clothes dryers

purchased in the 30-year period that begins in the anticipated year of compliance with the

amended standards (2028–2057), amount to 2.7 quadrillion British thermal units (“Btu”),

or quads.

This represents a savings of 11 percent relative to the energy use of these

products in the case without amended standards (referred to as the “no-new-standards

case”).

The cumulative net present value (“NPV”) of total consumer benefits of the

standards for consumer clothes dryers ranges from $ 9.23 billion (at a 7-percent discount

rate) to $20.08 billion (at a 3-percent discount rate). This NPV expresses the estimated

All monetary values in this document are expressed in 2022 dollars and, where appropriate, are

discounted to 2024 unless explicitly stated otherwise.

The quantity refers to full-fuel-cycle (“FFC”) energy savings. FFC energy savings includes the energy

consumed in extracting, processing, and transporting primary fuels (i.e., coal, natural gas, petroleum fuels),

and, thus, presents a more complete picture of the impacts of energy efficiency standards. For more

information on the FFC metric, see section IV.H.2 of this document.

total value of future operating-cost savings minus the estimated increased product and

installation costs for consumer clothes dryers purchased during the period 2028–2057.

In addition, the adopted standards for consumer clothes dryers are projected to

yield significant environmental benefits. DOE estimates that the standards will result in

cumulative emission reductions (over the same period as for energy savings) of 57.1

million metric tons (“Mt”)

of carbon dioxide (“CO

”), 13.9 thousand tons of sulfur

dioxide (“SO

”), 116.5 thousand tons of nitrogen oxides (“NO

”), 527.6 thousand tons of

methane (“CH

”), 0.5 thousand tons of nitrous oxide (“N

O”), and 0.1 tons of mercury

(“Hg”).

The estimated cumulative reduction in CO

emissions through 2030 amounts

to 1.3 Mt, which is equivalent to the emissions resulting from the annual electricity use of

more than 260 thousand homes.

DOE estimates the value of climate benefits from a reduction in greenhouse gases

(“GHG”) using four different estimates of the social cost of CO

(“SC-CO

”), the social

cost of methane (“SC-CH

”), and the social cost of nitrous oxide (“SC-N

O”). Together

these represent the social cost of GHG (“SC-GHG”). DOE used interim SC-GHG values

(in terms of benefit per ton of GHG avoided) developed by an Interagency Working

Group on the Social Cost of Greenhouse Gases (“IWG”).

The derivation of these values

A metric ton is equivalent to 1.1 short tons. Results for emissions other than CO

are presented in short

tons.

DOE calculated emissions reductions relative to the no-new-standards case, which reflects key

assumptions in the Annual Energy Outlook 2023 (“AEO2023”). AEO2023 represents current Federal and

State legislation and final implementation of regulations as of the time of its preparation. See section IV.K

of this document for further discussion of AEO2023 assumptions that affect air pollutant emissions.

To monetize the benefits of reducing GHG emissions, this analysis uses the interim estimates presented

in the Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates

is discussed in section IV.L of this document. For presentational purposes, the climate

benefits associated with the average SC-GHG at a 3-percent discount rate are estimated

to be $3.3 billion. DOE does not have a single central SC-GHG point estimate and it

emphasizes the importance and value of considering the benefits calculated using all four

sets of SC-GHG estimates.

DOE estimated the monetary health benefits of SO

and NO

emissions

reductions, using benefit-per-ton estimates from the Environmental Protection Agency,

as discussed in section IV.L of this document. DOE estimated the present value of the

health benefits would be $2.6 billion using a 7-percent discount rate, and $6.3 billion

using a 3-percent discount rate.

DOE is currently only monetizing health benefits from

changes in ambient fine particulate matter (PM

2.5

) concentrations from two precursors

(SO

and NO

), and from changes in ambient ozone from one precursor (for NO

), but

will continue to assess the ability to monetize other effects such as health benefits from

reductions in direct PM

2.5

emissions.

Table I.3 summarizes the monetized benefits and costs expected to result from the

amended standards for consumer clothes dryers. There are other important unquantified

effects, including certain unquantified climate benefits, unquantified public health

Under Executive Order 13990 published in February 2021 by the IWG. (“February 2021 SC-GHG TSD”).

www.whitehouse.gov/wp-

content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf.

U.S. EPA. Estimating the Benefit per Ton of Reducing Directly Emitted PM2.5, PM2.5 Precursors and

Ozone Precursors from 21 Sectors. Available at www.epa.gov/benmap/estimating-benefit-ton-reducing-

pm25-precursors-21-sectors.

DOE estimates the economic value of these emissions reductions resulting from the considered trial

standard levels (“TSLs”) for the purpose of complying with the requirements of Executive Order 12866.

benefits from the reduction of toxic air pollutants and other emissions, unquantified

energy security benefits, and distributional effects, among others.

Table I.3 Summary of Monetized Benefits and Costs of Adopted Energy

Conservation Standards for Consumer Clothes Dryers

Billion (2022$)

3% discount rate

Consumer Operating Cost Savings 21.1

Climate Benefits* 3.3

Health Benefits** 6.3

Total Benefits† 30.7

Consumer Incremental Product Costs‡ 1.0

Net Monetized Benefits 20.1

Change in Producer Cash Flow (INPV

‡‡

) (0.14) – (0.12)

7% discount rate

Consumer Operating Cost Savings 9.8

Climate Benefits* (3% discount rate) 3.3

Health Benefits** 2.6

Total Benefits† 15.8

Consumer Incremental Product Costs‡ 0.6

Net Monetized Benefits 9.2

Change in Producer Cash Flow (INPV

‡‡

) (0.14) – (0.12)

Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2028–

2057. These results include consumer, climate, and health benefits that accrue after 2057 from the products

shipped in 2028–2057.

* Climate benefits are calculated using four different estimates of the global SC-GHG (see section IV.L of

this document). For presentational purposes of this table, the climate benefits associated with the average

SC-GHG at a 3-percent discount rate are shown; however, DOE emphasizes the importance and value of

considering the benefits calculated using all four sets of SC-GHG estimates. To monetize the benefits of

reducing GHG emissions, this analysis uses the interim estimates presented in the Technical Support

Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates Under Executive Order

13990 published in February 2021 by the IWG.

** Health benefits are calculated using benefit-per-ton values for NO

and SO

. DOE is currently only

monetizing (for SO

and NO

) PM

2.5

precursor health benefits and (for NO

) ozone precursor health

benefits, but will continue to assess the ability to monetize other effects such as health benefits from

reductions in direct PM

2.5

emissions. See section IV.L of this document for more details.

† Total and net benefits include those consumer, climate, and health benefits that can be quantified and monetized. For

presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average

SC-GHG with a 3-percent discount rate.

‡ Costs include incremental equipment costs as well as installation costs.

‡‡ Operating Cost Savings are calculated based on the life cycle costs analysis and national impact analysis

as discussed in detail below. See sections IV.F and IV.H of this document. DOE’s national impact

analysis includes all impacts (both costs and benefits) along the distribution chain beginning with the

increased costs to the manufacturer to manufacture the product and ending with the increase in price

experienced by the consumer. DOE also separately conducts a detailed analysis on the impacts on

manufacturers (the MIA). See section IV.J of this document and chapter 12 of the direct final rule technical

support document (“TSD”). In the detailed MIA, DOE models manufacturers’ pricing decisions based on

assumptions regarding investments, conversion costs, cashflow, and margins. The MIA produces a range

of impacts, which is the rule’s expected impact on the INPV. The change in INPV is the present value of all

changes in industry cash flow, including changes in production costs, capital expenditures, and

manufacturer profit margins. Change in INPV is calculated using the industry weighted average cost of

capital value of 7.5 percent that is estimated in the MIA (see chapter 12 of the direct final rule TSD for a

complete description of the industry weighted average cost of capital). For consumer clothes dryers, those

values are -$144 million to -$120 million. DOE accounts for that range of likely impacts in analyzing

whether a TSL is economically justified. See section V.C of this document. DOE is presenting the range of

impacts to the INPV under two manufacturer markup scenarios: the Preservation of Gross Margin scenario,

which is the manufacturer markup scenario used in the calculation of Consumer Operating Cost Savings in

this table, and the Preservation of Operating Profit scenario, where DOE assumed manufacturers would not

be able to increase per-unit operating profit in proportion to increases in manufacturer production costs.

DOE includes the range of estimated change in INPV in the above table, drawing on the MIA explained

further in section IV.J of this document, to provide additional context for assessing the estimated impacts of

this direct final rule to society, including potential changes in production and consumption, which is

consistent with OMB’s Circular A-4 and E.O. 12866. If DOE were to include the INPV into the net benefit

calculation for this direct final rule, the net benefits would range from $19.96 billion to $19.98 billion at 3-

percent discount rate and would range from $9.06 billion to $9.08 billion at 7-percent discount rate.

Parentheses () indicate negative values.

The benefits and costs of the adopted standards can also be expressed in terms of

annualized values. The monetary values for the total annualized net benefits are (1) the

reduced consumer operating costs, minus (2) the increase in product purchase prices and

installation costs, plus (3) the value of climate and health benefits of emission reductions,

all annualized.

To convert the time-series of costs and benefits into annualized values, DOE calculated a present value in

2024, the year used for discounting the NPV of total consumer costs and savings. For the benefits, DOE

calculated a present value associated with each year’s shipments in the year in which the shipments occur

(e.g., 2020 or 2030), and then discounted the present value from each year to 2024. Using the present

value, DOE then calculated the fixed annual payment over a 30-year period, starting in the compliance

year, that yields the same present value.

The national operating cost savings are domestic private U.S. consumer monetary

savings that occur as a result of purchasing the covered products and are measured for the

lifetime of consumer clothes dryers shipped in 2028–2057. The benefits associated with

reduced emissions achieved as a result of the adopted standards are also calculated based

on the lifetime of consumer clothes dryers shipped in 2028–2057. Total benefits for both

the 3-percent and 7-percent cases are presented using the average GHG social costs with

a 3-percent discount rate. Estimates of SC-GHG values are presented for all four SC-

GHG discount rates in section IV.L of this document.

Table I.4 presents the total estimated monetized benefits and costs associated with

the adopted standards, expressed in terms of annualized values. The results under the

primary estimate are as follows.

Using a 7-percent discount rate for consumer benefits and costs and health

benefits from reduced NO

and SO

emissions, and the 3-percent discount rate case for

climate benefits from reduced GHG emissions, the estimated cost of the standards

adopted in this rule is $60.0 million per year in increased equipment costs, while the

estimated annual benefits are $971.4 million in reduced equipment operating costs,

$185.5 million in climate benefits, and $259.9 million in health benefits. In this case, the

net benefit would amount to $1,357 million per year.

Using a 3-percent discount rate for all benefits and costs, the estimated cost of the

standards is $57.2 million per year in increased equipment costs, while the estimated

annual benefits are $1,177 million in reduced operating costs, $185.5 million in climate

benefits, and $349.4 million in health benefits. In this case, the net benefit would amount

to $1,654 million per year.

Table I.4 Annualized Benefits and Costs of Adopted Standards for Consumer

Clothes Dryers (2028−2057)

Million/year (2022$)

Primary Estimate

Low-Net-Benefits

Estimate

High-Net-

Benefits Estimate

3% discount rate

Consumer Operating Cost Savings 1,177 1,103 1,230

Climate Benefits* 185.5 178.9 187.8

Health Benefits** 349.4 337.2 353.7

Total Benefits† 1,712 1,619 1,771

Consumer Incremental Product Costs 57.2 58.9 54.4

Net Benefits 1,654 1,560 1,717

Change in Producer Cash Flow (INPV

‡‡

) (12) – (10) (12) – (10) (12) – (10)

7% discount rate

Consumer Operating Cost Savings 971.4 915.5 1,014

Climate Benefits* (3% discount rate) 185.5 178.9 187.8

Health Benefits** 259.9 251.5 262.8

Total Benefits† 1,417 1,346 1,464

Consumer Incremental Product Costs‡ 60.0 61.2 57.7

Net Benefits 1,357 1,285 1,407

Change in Producer Cash Flow (INPV

‡‡

) (12) - (10) (12) - (10) (12) - (10)

Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in

2028−2057. These results include benefits to consumers which accrue after 2057 from the products

shipped in 2028−2057. The Primary, Low-Net-Benefits, and High-Net-Benefits estimates utilize

projections of energy prices from the AEO2023 Reference case, Low Economic Growth case, and High

Economic Growth case, respectively. In addition, incremental equipment costs reflect a medium decline

rate in the Primary Estimate, a constant rate in the Low-Net-Benefits Estimate, and a high decline rate in

the High-Net-Benefits Estimate. The methods used to derive projected price trends are explained in

sections IV.F.1 and IV.H.3 of this document. Note that the Benefits and Costs may not sum up to the Net

Benefits due to rounding.

* Climate benefits are calculated using four different estimates of the global SC-GHG (see section IV.L of

this document). For presentational purposes of this table, the climate benefits associated with the average

SC-GHG at a 3-percent discount rate are shown,

but DOE does not have a single central SC-GHG point estimate,

and it emphasizes the importance and value of considering the benefits calculated using all four sets of SC-

GHG estimates. To monetize the benefits of reducing GHG emissions, this analysis uses the interim

estimates presented in the Technical Support Document: Social Cost of Carbon, Methane, and Nitrous

Oxide Interim Estimates Under Executive Order 13990 published in February 2021 by the IWG.

** Health benefits are calculated using benefit-per-ton values for NO

and SO

. DOE is currently only

monetizing (for SO

and NO

) PM

2.5

precursor health benefits and (for NO

) ozone precursor health

benefits, but will continue to assess the ability to monetize other effects such as health benefits from

reductions in direct PM

2.5

emissions. See section IV.L of this document for more details.

† Total benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with a

3-percent discount rate, but DOE does not have a single central SC-GHG point estimate.

‡ Costs include incremental equipment costs as well as installation costs.

‡‡ Operating Cost Savings are calculated based on the life cycle costs analysis and national impact analysis

as discussed in detail below. See sections IV.F and IV.H of this document. DOE’s national impact

analysis includes all impacts (both costs and benefits) along the distribution chain beginning with the

increased costs to the manufacturer to manufacture the product and ending with the increase in price

experienced by the consumer. DOE also separately conducts a detailed analysis on the impacts on

manufacturers (the MIA). See section IV.J of this document and chapter 12 of the direct final rule TSD. In

the detailed MIA, DOE models manufacturers’ pricing decisions based on assumptions regarding

investments, conversion costs, cashflow, and margins. The MIA produces a range of impacts, which is the

rule’s expected impact on the INPV. The change in INPV is the present value of all changes in industry

cash flow, including changes in production costs, capital expenditures, and manufacturer profit margins.

The annualized change in INPV is calculated using the industry weighted average cost of capital value of

7.5 percent that is estimated in the manufacturer impact analysis (see chapter 12 of the direct final rule TSD

for a complete description of the industry weighted average cost of capital). For consumer clothes dryers,

those values are -$12 million to -$10 million. DOE accounts for that range of likely impacts in analyzing

whether a TSL is economically justified. See section V.C of this document. DOE is presenting the range of

impacts to the INPV under two manufacturer markup scenarios: the Preservation of Gross Margin scenario,

which is the manufacturer markup scenario used in the calculation of Consumer Operating Cost Savings in

this table, and the Preservation of Operating Profit Markup scenario, where DOE assumed manufacturers

would not be able to increase per-unit operating profit in proportion to increases in manufacturer

production costs. DOE includes the range of estimated annualized change in INPV in the above table,

drawing on the MIA explained further in chapter 12 of this direct final rule TSD, to provide additional

context for assessing the estimated impacts of this direct final rule to society, including potential changes in

production and consumption, which is consistent with OMB’s Circular A-4 and E.O. 12866. If DOE were

to include the INPV into the annualized net benefit calculation for this direct final rule, the annualized net

benefits, using the primary estimate, would range from $1,642 million to $1,644 at 3-percent discount rate

and would range from $1,345 million to $1,347 million at 7-percent discount rate. Parentheses () indicate

negative values.

DOE’s analysis of the national impacts of the adopted standards is described in

sections IV.H, IV.K, and IV.L of this document.

D. Conclusion

DOE has determined that the Joint Agreement was submitted jointly by interested

persons that are fairly representative of relevant points of view, in accordance with 42

U.S.C. 6295(p)(4)(A). After considering the recommended standards and weighing the

benefits and burdens, DOE has determined that the recommended standards are in

accordance with 42 U.S.C. 6295(o), which contains the criteria for prescribing new or

amended standards. Specifically, the Secretary of Energy (“Secretary”) has determined

that the adoption of the recommended standards would result in the significant

conservation of energy and is the maximum improvement in energy efficiency that is

technologically feasible and economically justified. In determining whether the

recommended standards are economically justified, the Secretary has determined that the

benefits of the recommended standards exceed the burdens. The Secretary has further

concluded that the recommended standards, when considering the benefits of energy

savings, positive NPV of consumer benefits, emission reductions, the estimated monetary

value of the emissions reductions, and positive average LCC savings, would yield

benefits that outweigh the negative impacts on some consumers and on manufacturers,

including the conversion costs that could result in a reduction in INPV for manufacturers.

Using a 7-percent discount rate for consumer benefits and costs and NO

and SO

reduction benefits, and a 3-percent discount rate case for GHG social costs, the estimated

cost of the standards for consumer clothes dryers is $60.0 million per year in increased

product costs, while the estimated annual benefits are $971.4 million in reduced product

operating costs, $185.5 million in climate benefits, and $259.9 million in health benefits.

The net benefit amounts to $1,357 million per year. DOE notes that the net benefits are

substantial even in the absence of the climate benefits,

and DOE would adopt the same

standards in the absence of such benefits.

The significance of energy savings offered by a new or amended energy

conservation standard cannot be determined without knowledge of the specific

circumstances surrounding a given rulemaking.

For example, some covered products

and equipment have most of their energy consumption occur during periods of peak

energy demand. The impacts of these products on the energy infrastructure can be more

pronounced than products with relatively constant demand. Accordingly, DOE evaluates

the significance of energy savings on a case-by-case basis.

As previously mentioned, the standards are projected to result in estimated

national energy savings of 2.7 quads FFC, the equivalent of the primary annual energy

use of 18 million homes. In addition, they are projected to reduce cumulative CO

emissions by 57.1 Mt. Based on these findings, DOE has determined the energy savings

from the standard levels adopted in this direct final rule are “significant” within the

meaning of 42 U.S.C. 6295(o)(3)(B). A more detailed discussion of the basis for these

conclusions is contained in the remainder of this document and the accompanying TSD.

Under the authority provided by 42 U.S.C. 6295(p)(4), DOE is issuing this direct

final rule amending the energy conservation standards for consumer clothes dryers.

The information on climate benefits is provided in compliance with Executive Order 12866.

Procedures, Interpretations, and Policies for Consideration in New or Revised Energy Conservation

Standards and Test Procedures for Consumer Products and Commercial/Industrial Equipment, 86 FR

70892, 70901 (Dec. 13, 2021).

Consistent with this authority, DOE is also simultaneously publishing elsewhere in this

Federal Register a NOPR proposing standards that are identical to those contained in this

direct final rule. See 42 U.S.C. 6295(p)(4)(A)(i).

II.

Introduction

The following section briefly discusses the statutory authority underlying this

direct final rule, as well as some of the relevant historical background related to the

establishment of standards for consumer clothes dryers.

A. Authority

EPCA authorizes DOE to regulate the energy efficiency of a number of consumer

products and certain industrial equipment. Title III, Part B of EPCA established the

Energy Conservation Program for Consumer Products Other Than Automobiles. These

products include consumer clothes dryers, the subject of this document. (42 U.S.C.

6292(a)(8)) EPCA prescribed energy conservation standards for these products (42

U.S.C. 6295(g)(3)), and directed DOE to conduct future rulemakings to determine

whether to amend these standards. (42 U.S.C. 6295(g)(4)) EPCA further provides that,

not later than 6 years after the issuance of any final rule establishing or amending a

standard, DOE must publish either a notice of determination that standards for the

product do not need to be amended, or a NOPR including new proposed energy

conservation standards (proceeding to a final rule, as appropriate). (42 U.S.C.

6295(m)(1))

The energy conservation program under EPCA consists essentially of four parts:

(1) testing, (2) labeling, (3) the establishment of Federal energy conservation standards,

and (4) certification and enforcement procedures. Relevant provisions of EPCA

specifically include definitions (42 U.S.C. 6291), test procedures (42 U.S.C. 6293),

labeling provisions (42 U.S.C. 6294), energy conservation standards (42 U.S.C. 6295),

and the authority to require information and reports from manufacturers (42 U.S.C.

6296).

Federal energy efficiency requirements for covered products established under

EPCA generally supersede State laws and regulations concerning energy conservation

testing, labeling, and standards. (42 U.S.C. 6297(a)–(c)) DOE may, however, grant

waivers of Federal preemption in limited instances for particular State laws or

regulations, in accordance with the procedures and other provisions set forth under

EPCA. (42 U.S.C. 6297(d))

Subject to certain criteria and conditions, DOE is required to develop test

procedures to measure the energy efficiency, energy use, or estimated annual operating

cost of each covered product. (42 U.S.C. 6295(o)(3)(A) and 42 U.S.C. 6295(r))

Manufacturers of covered products must use the prescribed DOE test procedure as the

basis for certifying to DOE that their products comply with the applicable energy

conservation standards adopted under EPCA and when making representations to the

public regarding the energy use or efficiency of those products. (42 U.S.C. 6293(c) and

6295(s)) Similarly, DOE must use these test procedures to determine whether the

products comply with standards adopted pursuant to EPCA. (42 U.S.C. 6295(s)) The

DOE test procedures for consumer clothes dryers appear at title 10 of the Code of Federal

Regulations (“CFR”) part 430, subpart B, appendix D1 (“appendix D1”) and appendix

D2 (“appendix D2”).

DOE must follow specific statutory criteria for prescribing new or amended

standards for covered products, including consumer clothes dryers. Any new or amended

standard for a covered product must be designed to achieve the maximum improvement

in energy efficiency that the Secretary determines is technologically feasible and

economically justified. (42 U.S.C. 6295(o)(2)(A) Furthermore, DOE may not adopt any

standard that would not result in the significant conservation of energy. (42 U.S.C.

6295(o)(3)(B))

Moreover, DOE may not prescribe a standard if DOE determines by rule that the

standard is not technologically feasible or economically justified. (42 U.S.C.

6295(o)(3)(B)) In deciding whether a proposed standard is economically justified, DOE

must determine whether the benefits of the standard exceed its burdens. (42 U.S.C.

6295(o)(3)(B)) DOE must make this determination after receiving comments on the

proposed standard, and by considering, to the greatest extent practicable, the following

seven statutory factors:

(1) The economic impact of the standard on manufacturers and consumers of the

products subject to the standard;

(2) The savings in operating costs throughout the estimated average life of the

covered products in the type (or class) compared to any increase in the price,

initial charges, or maintenance expenses for the covered products that are

likely to result from the standard;

(3) The total projected amount of energy (or as applicable, water) savings likely to

result directly from the standard;

(4) Any lessening of the utility or the performance of the covered products likely

to result from the standard;

(5) The impact of any lessening of competition, as determined in writing by the

Attorney General, that is likely to result from the standard;

(6) The need for national energy and water conservation; and

(7) Other factors the Secretary considers relevant.

(42 U.S.C. 6295(o)(2)(B)(i)(I)–(VII))

Further, EPCA, as codified, establishes a rebuttable presumption that a standard is

economically justified if the Secretary finds that the additional cost to the consumer of

purchasing a product complying with an energy conservation standard level will be less

than three times the value of the energy savings during the first year that the consumer

will receive as a result of the standard, as calculated under the applicable test procedure.

(42 U.S.C. 6295(o)(2)(B)(iii))

EPCA, as codified, also contains what is known as an “anti-backsliding”

provision, which prevents the Secretary from prescribing any amended standard that

either increases the maximum allowable energy use or decreases the minimum required

energy efficiency of a covered product. (42 U.S.C. 6295(o)(1)) Also, the Secretary may

not prescribe an amended or new standard if interested persons have established by a

preponderance of evidence that the standard is likely to result in the unavailability in the

United States in any covered 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. (42 U.S.C. 6295(o)(4))

EPCA specifies requirements when promulgating an energy conservation standard

for a covered product that has two or more subcategories. A rule prescribing an energy

conservation standard for a type (or class) of product must specify a different standard

level for a type or class of products that has the same function or intended use if DOE

determines that products within such group (A) consume a different kind of energy from

that consumed by other covered products within such type (or class); or (B) have a

capacity or other performance-related feature which other products within such type (or

class) do not have and such feature justifies a higher or lower standard. (42 U.S.C.

6295(q)(1)) In determining whether a performance-related feature justifies a different

standard for a group of products, DOE consider such factors as the utility to the consumer

of such a feature and other factors DOE deems appropriate. Id. Any rule prescribing such

a standard must include an explanation of the basis on which such higher or lower level

was established. (42 U.S.C. 6295(q)(2))

Additionally, pursuant to the amendments contained in the Energy Independence

and Security Act of 2007 (“EISA 2007”), Pub. L. 110-140, final rules for new or

amended energy conservation standards promulgated after July 1, 2010, are required to

address standby mode and off mode energy use. (42 U.S.C. 6295(gg)(3)) Specifically,

when DOE adopts a standard for a covered product after that date, it must, if justified by

the criteria for adoption of standards under EPCA (42 U.S.C. 6295(o)), incorporate

standby mode and off mode energy use into a single standard, or, if that is not feasible,

adopt a separate standard for such energy use for that product. (42 U.S.C.

6295(gg)(3)(A)–(B)) DOE’s current test procedures for consumer clothes dryers address

standby mode and off mode energy use, as do the amended standards adopted in this

direct final rule.

Finally, EISA 2007 amended EPCA, in relevant part, to grant DOE authority to

directly issue a final rule (i.e., a “direct final rule”) establishing an energy conservation

standard upon receipt of a statement submitted jointly by interested persons that are fairly

representative of relevant points of view (including representatives of manufacturers of

covered products, States, and efficiency advocates), as determined by the Secretary, that

contains recommendations with respect to an energy or water conservation standard. (42

U.S.C. 6295(p)(4)) Pursuant to 42 U.S.C. 6295(p)(4), the Secretary must also determine

whether a jointly submitted recommendation for an energy or water conservation

standard satisfies 42 U.S.C. 6295(o) or 42 U.S.C. 6313(a)(6)(B), as applicable.

The direct final rule must be published simultaneously with a NOPR that proposes

an energy or water conservation standard that is identical to the standard established in

the direct final rule, and DOE must provide a public comment period of at least 110 days

on this proposal. (42 U.S.C. 6295(p)(4)(A)–(B)) While DOE typically provides a

comment period of 60 days on proposed standards, for a NOPR accompanying a direct

final rule, DOE provides a comment period of the same length as the comment period on

the direct final rule—i.e., 110 days. Based on the comments received during this period,

the direct final rule will either become effective, or DOE will withdraw it not later than

120 days after its issuance if: (1) one or more adverse comments is received, and (2)

DOE determines that those comments, when viewed in light of the rulemaking record

related to the direct final rule, may provide a reasonable basis for withdrawal of the direct

final rule under 42 U.S.C. 6295(o). (42 U.S.C. 6295(p)(4)(C)) Receipt of an alternative

joint recommendation may also trigger a DOE withdrawal of the direct final rule in the

same manner. (Id.)

DOE has previously explained its interpretation of its direct final rule authority. In

a final rule amending the Department’s “Procedures, Interpretations and Policies for

Consideration of New or Revised Energy Conservation Standards for Consumer

Products” at 10 CFR part 430, subpart C, appendix A (“Process Rule” or “appendix A”),

DOE noted that it may issue standards recommended by interested persons that are fairly

representative of relative points of view as a direct final rule when the recommended

standards are in accordance with 42 U.S.C. 6295(o) or 42 U.S.C. 6313(a)(6)(B), as

applicable. 86 FR 70892, 70912 (Dec. 13, 2021). But the direct final rule provision in

EPCA does not impose additional requirements applicable to other standards

rulemakings, which is consistent with the unique circumstances of rules issued through

consensus agreements under DOE’s direct final rule authority. Id. DOE's discretion

remains bounded by its statutory mandate to adopt a standard that results in the maximum

improvement in energy efficiency that is technologically feasible and economically

justified—a requirement found in 42 U.S.C. 6295(o). Id. As such, DOE’s review and

analysis of the Joint Agreement is limited to whether the recommended standards satisfy

the criteria in 42 U.S.C. 6295(o).

B. Background

1. Current Standards

In a direct final rule published on April 21, 2011, (“April 2011 Direct Final

Rule”) DOE prescribed the current energy conservation standards for consumer clothes

dryers manufactured on and after January 1, 2015. 76 FR 22454.

These standards are

set forth in DOE’s regulations at 10 CFR 430.32(h)(3) and are shown in Table II.1.

These standards are consistent with a prior joint proposal submitted to DOE by interested

parties representing manufacturers, energy and environmental advocates, and consumer

groups.

The current standards are defined in terms of a minimum allowable CEF, as

measured according to appendix D1. Even though DOE maintained the same energy

DOE published a confirmation of effective date and compliance date for the direct final rule on August

24, 2011. 76 FR 52854.

Available at: www.regulations.gov/comment/EERE-2007-BT-STD-0010-0049.

efficiency descriptor for both appendix D1 and appendix D2, DOE notes that the CEF

values are not equivalent because of the extensive differences in test methods.

To avoid

potential confusion that would result from using the same efficiency descriptor for both

test procedures as it relates to the standards discussed in this document, DOE is including

a “D1” or “D2” subscript when referring to the appendix D1 CEF and appendix D2 CEF,

respectively (“CEF

” and “CEF

”).

Table II.1 Federal Energy Efficiency Standards for Consumer Clothes Dryers as

Measured Under Appendix D1

Product Class

CEF

(lb/kWh)

(i) Vented Electric, Standard (4.4 ft

or greater capacity)

3.73

(ii) Vented Electric, Compact (120V) (less than 4.4 ft

capacity)

3.61

(iii) Vented Electric, Compact (240V) (less than 4.4 ft

capacity)

3.27

(iv) Vented Gas

3.30

(v) Ventless Electric, Compact (240V) (less than 4.4 ft

capacity)

2.55

(vi) Ventless Electric, Combination Washer-Dryer

2.08

2. Current Test Procedure

On October 8, 2021, DOE published a final rule for the test procedure rulemaking

(86 FR 56608) (the “October 2021 TP Final Rule”), in which it amended appendix D1

and appendix D2, both entitled “Uniform Test Method for Measuring the Energy

Consumption of Clothes Dryers,” to provide additional detail in response to questions

from manufacturers and test laboratories, including additional detail regarding the testing

of “connected” models, dryness level selection, and the procedures for maintaining the

While the current standards are based on CEF as determined in accordance with appendix D1,

manufacturers are permitted to use the appendix D2 test procedure to comply with the current standards, as

long as they use a single appendix for all representations. Beginning on the compliance date of the

amended standards established by this direct final rule, manufacturers will be required to use appendix D2

to comply with the amended standards.

required heat input rate for gas consumer clothes dryers; additional detail for the test

procedures for performing inactive and off mode power measurements; specifications for

the final moisture content (“FMC”) required for testing automatic termination control

dryers; specification of a narrower scale resolution for the weighing scale used to

determine moisture content of test loads; and specification that the test load must be

weighed within 5 minutes after a test cycle has terminated. In addition, as part of the

October 2021 TP Final Rule, DOE amended the test procedures to update the estimated

number of annual use cycles for consumer clothes dryers; provide further direction for

additional provisions within the test procedures; specify rounding requirements for all

reported values; apply consistent use of nomenclature and correct typographical errors;

remove obsolete sections of the test procedures, including appendix D; and update the

reference to the applicable industry test procedure to the version certified by the

American National Standards Institute (“ANSI”). 86 FR 56608, 56610.

DOE’s current energy conservation standards for consumer clothes dryers are

expressed in terms of CEF

. (See 10 CFR 430.32(h)(3).) Appendix D1 tests timed

drying cycles, and accounts for clothes dryers with automatic termination controls by

applying a higher field use factor to units that have this feature. Appendix D2 tests

“normal” automatic termination cycles and more accurately measures the effects of

automatic cycle termination.

EPCA authorizes DOE to design test procedures that measure energy efficiency,

energy use, water use, or estimated annual operating cost of a covered product during a

representative average use cycle or period of use. (42 U.S.C. 6293(b)(3)) The appendix

D2 test procedure, which is required for use to demonstrate compliance with the amended

energy conservation standards established in this direct final rule, measures the energy

consumption of a representative use cycle that dries a load of laundry from an initial

moisture content of 57.5 percent to an FMC of less than 2 percent. 86 FR 56624-56625.

For timer clothes dryers, the test load is dried until the FMC is between 1 and 2.5 percent

of the bone-dry weight of the test load. The measured energy consumption is then

normalized to determine the energy consumption required to dry the test load to 2-percent

FMC, with a field use factor applied to account for the over-drying energy consumption.

For automatic termination control clothes dryers, appendix D2 specifies that a “normal”

program be selected for the test cycle, and for clothes dryers that do not have a “normal”

program, the cycle recommended by the manufacturer for drying cotton or linen shall be

selected. If the drying temperature and drying level settings can be chosen independently

of the program, they shall be set at the maximum drying temperature setting, and at a

“normal” or “medium” dryness level setting. The test is considered valid if the FMC of

the test load is 2 percent or less after the completion of the test cycle. If the FMC is

greater than 2 percent, the test is considered invalid and a new run shall be conducted

using the highest dryness level setting.

The current 2-percent FMC requirement using the DOE test cloth was adopted as

representative of approximately 5-percent FMC for “real-world” clothing, based on data

submitted in a joint petition for rulemaking.

DOE determined in the final rule published

The petition was submitted by AHAM, Whirlpool Corporation, General Electric Company, Electrolux,

LG Electronics, Inc., BSH, Alliance Laundry Systems, Viking Range, Sub-Zero Wolf, Friedrich A/C, U-

Line, Samsung, Sharp Electronics, Miele, Heat Controller, AGA Marvel, Brown Stove, Haier, Fagor

on August 14, 2013, that established the appendix D2 Test procedure that the specified 2-

percent FMC using the DOE test load was representative of consumer expectations for

dryness of clothing in field use. 78 FR 49608, 49620–49622, 49610–49611. DOE did not

amend the FMC requirements in the October 2021 TP Final Rule. 86 FR 56626.

DOE has conducted the rulemaking analysis for this direct final rule based on

CEF

because compliance with the amended energy conservation standards established

in this direct final rule must be determined based on the use of appendix D2. DOE

discusses additional details in section IV.C.1 of this document about how it developed the

engineering baseline, in terms of CEF

, from the current consumer clothes dryer

standards that are in terms of CEF

3. The Joint Agreement

On September 25, 2023, DOE received a joint statement of recommended

standards (i.e., the Joint Agreement) for various home appliance products, including

consumer clothes dryers, submitted jointly by groups representing manufacturers, energy

and environmental advocates, consumer groups, and a utility.

In addition to the

America, Airwell Group, Arcelik, Fisher & Paykel, Scotsman Ice, Indesit, Kuppersbusch, Kelon, and

DeLonghi, American Council for an Energy Efficient Economy, Appliance Standards Awareness Project,

Natural Resources Defense Council, Alliance to Save Energy, Alliance for Water Efficiency, Northwest

Power and Conservation Council, and Northeast Energy Efficiency Partnerships, Consumer Federation of

America and the National Consumer Law Center. See Docket No. EERE–2011–BT–TP– 0054, No. 3.

The signatories to the Joint Agreement include AHAM, American Council for an Energy-Efficient

Economy, Alliance for Water Efficiency, Appliance Standards Awareness Project, Consumer Federation of

America, Consumer Reports, Earthjustice, National Consumer Law Center, Natural Resources Defense

Council, Northwest Energy Efficiency Alliance, and Pacific Gas and Electric Company. Members of

AHAM’s Major Appliance Division that make the affected products include: Alliance Laundry Systems,

LLC; Asko Appliances AB; Beko US Inc.; Brown Stove Works, Inc.; BSH Home Appliances Corporation;

Danby Products, Ltd.; Electrolux Home Products, Inc.,; Elicamex S.A. de C.V.; Faber; Fotile America; GE

Appliances, a Haier Company; L’Atelier Paris Haute Design LLG; LG Electronics; Liebherr USA, Co.;

recommended standards for consumer clothes dryers, the Joint Agreement also included

separate recommendations for several other covered products.

And, while

acknowledging that DOE may implement these recommendations in separate

rulemakings, the Joint Agreement also stated that the recommendations were

recommended as a complete package and each recommendation is contingent upon the

other parts being implemented. DOE understands this to mean that the Joint Agreement

is contingent upon DOE initiating rulemaking processes to adopt all of the recommended

standards in the agreement. That is distinguished from an agreement where issuance of an

amended energy conservation standard for a covered product is contingent on issuance of

amended energy conservation standards for the other covered products. If the Joint

Agreement were so construed, it would conflict with the anti-backsliding provision in 42

U.S.C. 6295(o)(1), because it would imply the possibility that, if DOE were unable to

issue an amended standard for a certain product, it would have to withdraw a previously

issued standard for one of the other products. The anti-backsliding provision, however,

prevents DOE from withdrawing or amending an energy conservation standard to be less

stringent. As a result, DOE will be proceeding with individual rulemakings that will

evaluate each of the recommended standards separately under the applicable statutory

criteria.

Midea America Corp.; Miele, Inc.; Panasonic Appliances Refrigeration Systems (PAPRSA) Corporation of

America; Perlick Corporation; Samsung Electronics America Inc; Sharp Electronics Corporation; Smeg

S.p.A; Sub-Zero Group, Inc.; The Middleby Corporation; U-Line Corporation; Viking Range, LLC; and

Whirlpool Corporation.

The Joint Agreement contained recommendations for 6 covered products: refrigerators, refrigerator-

freezers, and freezers; clothes washers; clothes dryers; dishwashers; cooking products; and miscellaneous

refrigeration products.

A court decision issued after DOE received the Joint Agreement is also relevant

to this rule. On March 17, 2022, various States filed a petition seeking review of a final

rule revoking two final rules that established product classes for residential dishwashers

with a cycle time for the normal cycle of 60 minutes or less, top-loading residential

clothes washers (“RCWs”) and certain classes of consumer clothes dryers with a cycle

time of less than 30 minutes, and front-loading RCWs with a cycle time of less than 45

minutes (collectively, “short cycle product classes”). The petitioners argued that the final

rule revoking the short cycle product classes violated EPCA and was arbitrary and

capricious. On January 8, 2024, the United States Court of Appeals for the Fifth Circuit

granted the petition for review and remanded the matter to DOE for further proceedings

consistent with the Fifth Circuit’s opinion. See Louisiana v. United States Department of

Energy, 90 F.4th 461 (5th Cir. 2024). On February 14, 2024, following the Fifth Circuit’s

decision in Louisiana v. United States Department of Energy, DOE received a second

joint statement from this same group of stakeholders in which the signatories reaffirmed

the Joint Agreement, stating that the recommended standards represent the maximum

levels of efficiency that are technologically feasible and economically justified.

In the

letter, the signatories clarified that “short-cycle” product classes for RCWs, clothes

dryers, and dishwashers did not exist at the time that the signatories submitted their

recommendations and it is their understanding that these classes also do not exist at the

current time. Accordingly, the parties clarified that the Joint Agreement did not address

short-cycle product classes. The signatories also stated that they did not anticipate that the

This document is available in the docket at: www.regulations.gov/comment/EERE-2014-BT-STD-0058-

0058.

recommended energy conservation standards in the Joint Agreement will negatively

affect features or performance, including cycle time, for consumer clothes dryers.

The Joint Agreement recommends amended standard levels for consumer clothes

dryers as presented in Table II.2. (Joint Agreement, No. 55 at p. 9)

Details of the Joint

Agreement recommendations for other products are provided in the Joint Agreement

posted in the docket.

Table II.2 Recommended Amended Energy Conservation Standards for Consumer

Clothes Dryers

Product Class

Minimum Energy

Efficiency Ratio

(lb/kWh)

Compliance Date

Electric, Standard (4.4 cubic feet (“ft

”) or greater

capacity)

3.93

March 1, 2028

Electric, Compact (120 volts (“V”)) (less than 4.4 ft

capacity)

4.33

Vented Electric, Compact (240V) (less than 4.4 ft

capacity)

3.57

Vented Gas, Standard (4.4 ft

or greater capacity)

3.48

Vented Gas, Compact (less than 4.4 ft

capacity)

2.02

Ventless Electric, Compact (240V) (less than 4.4 ft

capacity)

2.68

Ventless Electric, Combination Washer-Dryer

2.33

When the Joint Agreement was submitted, DOE was conducting a rulemaking to

consider amending the standards for consumer clothes dryers. As part of that process,

DOE published a NOPR and announced a public meeting on August 23, 2022 (“August

The parenthetical reference provides a reference for information located in the docket of DOE’s

rulemaking to develop energy conservation standards for consumer clothes dryers. (Docket No. EERE-

2014-BT-STD-0058, which is maintained at www.regulations.gov). The references are arranged as follows:

(commenter name, comment docket ID number at page of that document).

The Joint Agreement available in the docket at www.regulations.gov/comment/EERE-2014-BT-STD-

0058-0055.

2022 NOPR”) seeking comment on its proposed amended standard to inform its decision

consistent with its obligations under EPCA and the Administrative Procedure Act

(“APA”). 87 FR 51734. DOE subsequently held a public webinar on September 13,

2022, to discuss and receive comments on the NOPR TSD.

Although DOE is adopting the Joint Agreement as a direct final rule and no

longer proceeding with its prior rulemaking, DOE did consider relevant comments, data,

and information obtained during that rulemaking process in determining whether the

recommended standards from the Joint Agreement are in accordance with 42 U.S.C.

6295(o). Any discussion of comments, data, or information in this direct final rule that

were obtained during DOE’s prior rulemaking will include a parenthetical reference that

provides the location of the item in the public record.

III.

General Discussion

DOE is issuing this direct final rule after determining that the recommended

standards submitted in the Joint Agreement meet the requirements in 42 U.S.C.

6295(p)(4). More specifically, DOE has determined that the recommended standards

were submitted by interested persons that are fairly representative of relevant points of

view and the recommended standards satisfy the criteria in 42 U.S.C. 6295(o).

The parenthetical reference provides a reference for information located in the docket of DOE’s

rulemaking to develop energy conservation standards for consumer clothes dryers. (Docket No. EERE-

2014-BT-STD-0058, which is maintained at www.regulations.gov). The references are arranged as follows:

(commenter name, comment docket ID number at page of that document).

On March 17, 2022, various states filed a petition seeking review of a final rule

revoking two final rules that established product classes for residential dishwashers with

a cycle time for the normal cycle of 60 minutes or less, top-loading RCWs and certain

classes of consumer clothes dryers with a cycle time of less than 30 minutes, and front-

loading RCWs with a cycle time of less than 45 minutes (collectively, “short cycle

product classes”). The petitioners argued that the final rule revoking the short cycle

product classes violated EPCA and was arbitrary and capricious. On January 8, 2024, the

United States Court of Appeals for the Fifth Circuit granted the petition for review and

remanded the matter to DOE for further proceedings consistent with the Fifth Circuit’s

opinion. See Louisiana v. United States Department of Energy, 90 F.4th 461 (5th Cir.

2024)

Following the Fifth Circuit’s decision, the signatories to the Joint Agreement

submitted a second letter to DOE, which stated that Joint Recommendation did not

“address” “short-cycle product classes.”

That is because, as the letter explained, such

product classes “did not exist” at the time of the Joint Agreement.

In a recently issued Request for Information,

DOE is commencing a rulemaking

process on remand from the Fifth Circuit (the Remand Proceeding) by soliciting further

information, relevant to the issues identified by the Fifth Circuit, regarding any short

cycle product classes. In that Remand Proceeding, DOE will conduct the analysis

This document is available in the docket at: www.regulations.gov/comment/EERE-2014-BT-STD-0058-

0058.

See https://www1.eere.energy.gov/buildings/appliance_standards/standards.aspx?productid=50.

required by 42 U.S.C. 6295(q)(1)(B) to determine whether any short-cycle products have

a “capacity or other performance-related feature [that] . . . justifies a higher or lower

standard from that which applies (or will apply) to other products. ..... ”

The current standards applicable to any products within the scope of that

proceeding remain unchanged by this rule. See 10 CFR 430.32(g). Consistent with the

Joint Parties’ letter, short-cycle products are not subject to the amended standards

adopted by this direct final rule. If the short-cycle products that DOE will consider in the

Remand Proceeding were subject to these standards, that would have the practical effect

of limiting the options available in the Remand Proceeding. That is because EPCA’s anti-

backsliding provision precludes DOE from prescribing any amended standard “which

increases the maximum allowable energy use” of a covered product. 42

U.S.C. 6295(o)(1). Accordingly, were the products at issue in the Remand Proceeding

also subject to the amended standards adopted here, the Department could only reaffirm

the standards adopted in this direct final rule or adopt more stringent standards.

The Joint Agreement specifies the product classes for consumer clothes dryers:

electric, standard; electric, compact; vented electric, compact; vented gas, standard;

vented gas, compact; ventless electric, compact; and ventless electric, combination

washer-dryer. Although these product classes were not further divided by cycle time,

DOE understands them to exclude vented electric standard-size clothes dryers and vented

gas standard-size clothes dryers with a cycle time of less than 30 minutes, when tested

according to appendix D2. As previously noted, any such “short-cycle” consumer clothes

dryers will be considered in the Remand Proceeding; the current standards applicable to

such “short-cycle” consumer clothes dryers are unchanged by this rule.

Under the direct final rule authority at 42 U.S.C. 6295(p)(4), DOE evaluates

whether recommended standards are in accordance with criteria contained in 42 U.S.C.

6295(o). DOE does not have the authority to revise recommended standards submitted

under the direct final rule provision in EPCA. Therefore, DOE did not analyze any

additional product classes beyond those product classes included in the Joint Agreement.

That is, DOE has not separately considered or established amended standards applicable

to any short-cycle product classes. In the event that DOE establishes short-cycle product

classes, pursuant to the rulemaking on remand from the Fifth Circuit, DOE will

necessarily consider what amended standards ought to apply to any such product classes

and will do so in conformance with EPCA.

DOE notes that the data and analysis used to support this direct final rule includes

information for vented electric standard-size clothes dryers and vented gas standard-size

clothes dryers that is not distinguished by cycle time and is representative of all consumer

clothes dryers currently on the market today. To the extent that any short cycle product

classes were included in this data and analysis, DOE believes the amount of such data is

negligible.

A. Scope of Coverage

Before discussing how the Joint Agreement meets the requirements for issuing a

direct final rule, it is important to clarify the scope of coverage for the recommended

standards. EPCA does not define the term “clothes dryer.” (See 42 U.S.C. 6291) DOE has

defined an “electric clothes dryer” as a cabinet-like appliance designed to dry fabrics in a

tumble-type drum with forced air circulation. The heat source is electricity and the drum

and blower(s) are driven by an electric motor(s). 10 CFR 430.2. DOE has defined a “gas

clothes dryer” as a cabinet-like appliance designed to dry fabrics in a tumble-type drum

with forced air circulation. The heat source is gas and the drum and blower(s) are driven

by an electric motor(s). Id. This direct final rule covers consumer clothes dryers, i.e.,

those consumer products that meet the definitions of “electric clothes dryer” and “gas

clothes dryer,” as codified at 10 CFR 430.2.

See section IV.A.1 of this document for discussion of the product classes analyzed

in this direct final rule.

B. Fairly Representative of Relevant Points of View

Under the direct final rule provision in EPCA, recommended energy conservation

standards must be submitted by interested persons that are fairly representative of

relevant points of view (including representatives of manufacturers of covered products,

States, and efficiency advocates) as determined by DOE. (42 U.S.C. 6295(p)(4)(A)) With

respect to this requirement, DOE notes that the Joint Agreement included a trade

association, AHAM, which represents 11 manufacturers of consumer clothes dryers.

The Joint Agreement also included environmental and energy-efficiency advocacy

organizations, consumer advocacy organizations, and a gas and electric utility company.

Additionally, DOE received a letter in support of the Joint Agreement from the States of

New York, California, and Massachusetts (See comment No. 56). DOE also received a

letter in support of the Joint Agreement from a gas and electric utility, SDG&E, and an

electric utility, SCE (See comment No. 57). As a result, DOE has determined that the

Joint Agreement was submitted by interested persons who are fairly representative of

relevant points of view.

C. Technological Feasibility

1. General

In each energy conservation standards rulemaking, DOE conducts a screening

analysis based on information gathered on all current technology options and prototype

designs that could improve the efficiency of the products or equipment that are the

subject of the rulemaking. In evaluating the recommended standards proposed in the

Joint Agreement, DOE conducted the same analysis. As the first step in such an analysis,

DOE develops a list of technology options for consideration in consultation with

manufacturers, design engineers, and other interested parties. DOE then determines

which of those means for improving efficiency are technologically feasible. DOE

These companies include: Alliance Laundry Systems, LLC; Beko US Inc.; BSH Home Appliances

Corporation; Danby Products, Ltd.; Electrolux Home Products, Inc.; GE Appliances, a Haier Company; LG

Electronics; Midea America Corp.; Miele, Inc.; Samsung Electronics America Inc.; and Whirlpool

Corporation.

considers technologies incorporated in commercially available products or in working

prototypes to be technologically feasible. Sections 6(b)(3)(i) and 7(b)(1) of appendix A.

After DOE has determined that particular technology options are technologically

feasible, it further evaluates each technology option in light of the following additional

screening criteria: (1) practicability to manufacture, install, and service; (2) adverse

impacts on product utility or availability; (3) adverse impacts on health or safety; and (4)

unique-pathway proprietary technologies. Sections 7(b)(2)–(5) of appendix A. Section

IV.

B of this document discusses the results of the screening analysis for consumer clothes

dryers, particularly the designs DOE considered, those it screened out, and those that are

the basis for the standards considered in this rulemaking. For further details on the

screening analysis for this rulemaking, see chapter 4 of the direct final rule TSD.

2. Maximum Technologically Feasible Levels

When DOE proposes to adopt an amended standard for a type or class of covered

product, it must determine the maximum improvement in energy efficiency or maximum

reduction in energy use that is technologically feasible for such product. (42 U.S.C.

6295(o)(2)(A)) Accordingly, in the engineering analysis, DOE determined the maximum

technologically feasible (“max-tech”) improvements in energy efficiency for consumer

clothes dryers using the design parameters for the most efficient products available on the

market or in working prototypes. The max-tech levels that DOE determined for this

rulemaking are described in section IV.C of this document and in chapter 5 of the direct

final rule TSD.

D. Energy Savings

1. Determination of Savings

For each TSL considered, DOE projected energy savings from application of the

TSL to consumer clothes dryers purchased in the 30-year period that begins in the year of

compliance with the amended standards (2027–2056 for all TSLs except the

Recommended TSL (i.e., TSL 3) and 2028–2057 for TSL 3).

The savings are measured

over the entire lifetime of consumer clothes dryers purchased in the 30-year analysis

period. DOE quantified the energy savings attributable to each TSL as the difference in

energy consumption between each standards case and the no-new-standards case. The

no-new-standards case represents a projection of energy consumption that reflects how

the market for a product would likely evolve in the absence of amended energy

conservation standards.

DOE used its national impact analysis (“NIA”) spreadsheet models to estimate

national energy savings (“NES”) from potential amended standards for consumer clothes

dryers. The NIA spreadsheet model (described in section IV.H of this document)

calculates energy savings in terms of site energy, which is the energy directly consumed

by products at the locations where they are used. For electricity, DOE reports national

energy savings in terms of primary energy savings, which is the savings in the energy that

is used to generate and transmit the site electricity. For natural gas, the primary energy

savings are considered to be equal to the site energy savings. DOE also calculates NES

in terms of FFC energy savings. The FFC metric includes the energy consumed in

DOE also presents a sensitivity analysis that considers impacts for products shipped in a 9-year period.

extracting, processing, and transporting primary fuels (i.e., coal, natural gas, petroleum

fuels), and thus presents a more complete picture of the impacts of energy conservation

standards.

DOE’s approach is based on the calculation of an FFC multiplier for each of

the energy types used by covered products or equipment. For more information on FFC

energy savings, see section IV.H.2 of this document.

2. Significance of Savings

To adopt any new or amended standards for a covered product including through

a direct final rule, DOE must determine that such action would result in significant

energy savings. (42 U.S.C. 6295(o)(3)(B))

The significance of energy savings offered by a new or amended energy

conservation standard cannot be determined without knowledge of the specific

circumstances surrounding a given rulemaking.

For example, some covered products

and equipment have most of their energy consumption occur during periods of peak

energy demand. The impact of these products on the energy infrastructure can be more

pronounced than products with relatively constant demand. Accordingly, DOE evaluates

the significance of energy savings on a case-by-case basis, taking into account the

significance of cumulative FFC national energy savings, the cumulative FFC emissions

reductions, and the need to confront the global climate crisis, among other factors.

The FFC metric is discussed in DOE’s statement of policy and notice of policy amendment. 76 FR

51282 (Aug. 18, 2011), as amended at 77 FR 49701 (Aug. 17, 2012).

Procedures, Interpretations, and Policies for Consideration in New or Revised Energy Conservation

Standards and Test Procedures for Consumer Products and Commercial/Industrial Equipment, 86 FR

70892, 70901 (Dec. 13, 2021).

As stated, the standard levels adopted in this direct final rule are projected to

result in national energy savings of 2.7 quads, the equivalent of the electricity use of 18

million homes in one year. Based on the amount of FFC savings, the corresponding

reduction in emissions, and the need to confront the global climate crisis, DOE has

determined the energy savings from the standard levels adopted in this direct final rule

are “significant” within the meaning of 42 U.S.C. 6295(o)(3)(B).

E. Economic Justification

1. Specific Criteria

As noted previously, EPCA provides seven factors to be evaluated in determining

whether a potential energy conservation standard is economically justified. (42 U.S.C.

6295(o)(2)(B)(i)(I)(VII)) The following sections discuss how DOE has addressed each

of those seven factors in this direct final rulemaking.

a. Economic Impact on Manufacturers and Consumers

In determining the impacts of amended standards on manufacturers, DOE

conducts an MIA, as discussed in section IV.J of this document. DOE first uses an

annual cash-flow approach to determine the quantitative impacts. This step includes both

a short-term assessment—based on the cost and capital requirements during the period

between when a regulation is issued and when entities must comply with the regulation—

and a long-term assessment over a 30-year period. The industry-wide impacts analyzed

include (1) INPV, which values the industry on the basis of expected future cash flows;

(2) cash flows by year; (3) changes in revenue and income; and (4) other measures of

impact, as appropriate. Second, DOE analyzes and reports the impacts on different types

of manufacturers, including impacts on small manufacturers. Third, DOE considers the

impact of standards on domestic manufacturer employment and manufacturing capacity,

as well as the potential for standards to result in plant closures and loss of capital

investment. Finally, DOE takes into account cumulative impacts of various DOE

regulations and other regulatory requirements on manufacturers.

For individual consumers, measures of economic impact include the changes in

LCC and PBP associated with new or amended standards. These measures are discussed

further in the following section. For consumers in the aggregate, DOE also calculates the

national net present value of the consumer costs and benefits expected to result from

particular standards. DOE also evaluates the impacts of potential standards on

identifiable subgroups of consumers that may be affected disproportionately by a

standard.

b. Savings in Operating Costs Compared to Increase in Price (LCC and PBP)

EPCA requires DOE to consider the savings in operating costs throughout the

estimated average life of the covered product in the type (or class) compared to any

increase in the price of, or in the initial charges for, or maintenance expenses of, the

covered product that are likely to result from a standard. (42 U.S.C. 6295(o)(2)(B)(i)(II))

DOE conducts this comparison in its LCC and PBP analysis.

The LCC is the sum of the purchase price of a product (including its installation)

and the operating cost (including energy, maintenance, and repair expenditures)

discounted over the lifetime of the product. The LCC analysis requires a variety of

inputs, such as product prices, product energy consumption, energy prices, maintenance

and repair costs, product lifetime, and discount rates appropriate for consumers. To

account for uncertainty and variability in specific inputs, such as product lifetime and

discount rate, DOE uses a distribution of values, with probabilities attached to each value.

The PBP is the estimated amount of time (in years) it takes consumers to recover

the increased purchase cost (including installation) of a more efficient product through

lower operating costs. DOE calculates the PBP by dividing the change in purchase cost

due to a more stringent standard by the change in annual operating cost for the year that

standards are assumed to take effect.

For its LCC and PBP analysis, DOE assumes that consumers will purchase the

covered products in the first year of compliance with new or amended standards. The

LCC savings for the considered efficiency levels are calculated relative to the case that

reflects projected market trends in the absence of new or amended standards. DOE’s

LCC and PBP analysis is discussed in further detail in section IV.F of this document.

c. Energy Savings

Although significant conservation of energy is a separate statutory requirement

for adopting an energy conservation standard, EPCA requires DOE, in determining the

economic justification of a standard, to consider the total projected energy savings that

are expected to result directly from the standard. (42 U.S.C. 6295(o)(2)(B)(i)(III)) As

discussed in section IV.H of this document, DOE uses the NIA spreadsheet models to

project national energy savings.

d. Lessening of Utility or Performance of Products

In evaluating design options and the impact of the recommended standard levels,

DOE evaluates potential standards that would not lessen the utility or performance of the

considered products. (42 U.S.C. 6295(o)(2)(B)(i)(IV)) Based on data available to DOE,

the standards adopted in this document would not reduce the utility or performance of the

products under consideration in this rulemaking.

e. Impact of Any Lessening of Competition

EPCA directs DOE to consider the impact of any lessening of competition, as

determined in writing by the Attorney General, that is likely to result from a standard.

(42 U.S.C. 6295(o)(2)(B)(i)(V)) It also directs the Attorney General to determine the

impact, if any, of any lessening of competition likely to result from a standard and to

transmit such determination to the Secretary within 60 days of the publication of a

proposed rule, together with an analysis of the nature and extent of the impact. (42

U.S.C. 6295(o)(2)(B)(ii)) DOE will transmit a copy of this direct final rule to the

Attorney General with a request that the Department of Justice (“DOJ”) provide its

determination on this issue. DOE will consider DOJ's comments on the rule in

determining whether to withdraw the direct final rule. DOE will also publish and respond

to the DOJ's comments in the Federal Register in a separate document.

f. Need for National Energy Conservation

DOE also considers the need for national energy and water conservation in

determining whether a new or amended standard is economically justified. (42 U.S.C.

6295(o)(2)(B)(i)(VI)) The energy savings from the adopted standards are likely to

provide improvements to the security and reliability of the Nation’s energy system.

Reductions in the demand for electricity also may result in reduced costs for maintaining

the reliability of the Nation’s electricity system. DOE conducts a utility impact analysis

to estimate how standards may affect the Nation’s needed power generation capacity, as

discussed in section IV.M of this document.

DOE maintains that environmental and public health benefits associated with the

more efficient use of energy are important to take into account when considering the need

for national energy conservation. The adopted standards are likely to result in

environmental benefits in the form of reduced emissions of air pollutants and GHGs

associated with energy production and use. DOE conducts an emissions analysis to

estimate how potential standards may affect these emissions, as discussed in section IV.K

of this document; the estimated emissions impacts are reported in section V.B.6 of this

document. DOE also estimates the economic value of emissions reductions resulting

from the considered TSLs, as discussed in section IV.L of this document.

g. Other Factors

In determining whether an energy conservation standard is economically justified,

DOE may consider any other factors that the Secretary deems to be relevant. (42 U.S.C.

6295(o)(2)(B)(i)(VII)) To the extent DOE identifies any relevant information regarding

economic justification that does not fit into the other categories described previously,

DOE could consider such information under “other factors.”

2. Rebuttable Presumption

As set forth in 42 U.S.C. 6295(o)(2)(B)(iii), EPCA creates a rebuttable

presumption that an energy conservation standard is economically justified if the

additional cost to the consumer of a product that meets the standard is less than three

times the value of the first year’s energy savings resulting from the standard, as

calculated under the applicable DOE test procedure. DOE’s LCC and PBP analyses

generate values used to calculate the effect potential amended energy conservation

standards would have on the payback period for consumers. These analyses include, but

are not limited to, the 3-year payback period contemplated under the rebuttable

presumption test. In addition, DOE routinely conducts an economic analysis that

considers the full range of impacts to consumers, manufacturers, the Nation, and the

environment, as required under 42 U.S.C. 6295(o)(2)(B)(i). The results of this analysis

serve as the basis for DOE’s evaluation of the economic justification for a potential

standard level (thereby supporting or rebutting the results of any preliminary

determination of economic justification). The rebuttable presumption payback

calculation is discussed in section IV.F of this document.

IV. Methodology and Discussion of Related Comments

This section addresses the analyses DOE has performed for this rulemaking

regarding consumer clothes dryers. Separate subsections address each component of

DOE’s analyses, including relevant comments DOE received during its separate

rulemaking to amend the energy conservation standards for consumer clothes dryers prior

to receiving the Joint Agreement.

DOE used several analytical tools to estimate the impact of the standards

considered in this document. The first tool is a spreadsheet that calculates the LCC

savings and PBP of potential amended or new energy conservation standards. The

national impacts analysis uses a second spreadsheet set that provides shipments

projections and calculates national energy savings and net present value of total consumer

costs and savings expected to result from potential energy conservation standards. DOE

uses the third spreadsheet tool, the Government Regulatory Impact Model (“GRIM”), to

assess manufacturer impacts of potential standards. These three spreadsheet tools are

available on the DOE website for this rulemaking: www.regulations.gov/docket/EERE-

2014-BT-STD-0058. Additionally, DOE used output from the latest version of the

Energy Information Administration’s (“EIA’s”) Annual Energy Outlook 2023

(“AEO2023”) for the emissions and utility impact analyses.

A. Market and Technology Assessment

DOE develops information in the market and technology assessment that provides

an overall picture of the market for the products concerned, including the purpose of the

products, the industry structure, manufacturers, market characteristics, and technologies

used in the products. This activity includes both quantitative and qualitative assessments,

based primarily on publicly available information. The subjects addressed in the market

and technology assessment for this rulemaking include (1) a determination of the scope

of the rulemaking and product classes, (2) manufacturers and industry structure, (3)

existing efficiency programs, (4) shipments information, (5) market and industry trends,

and (6) technologies or design options that could improve the energy efficiency of

consumer clothes dryers. The key findings of DOE’s market assessment are summarized

in the following sections. See chapter 3 of the direct final rule TSD for further discussion

of the market and technology assessment.

1. Product Classes

The Joint Agreement specifies seven product classes for consumer clothes dryers.

(Joint Agreement, No. 55 at p. 9). In this direct final rule, DOE is adopting the product

classes from the Joint Agreement, as listed in Table IV.1.

Table IV.1 Joint Agreement Consumer Clothes Dryer Product Classes

Product Classes

1. Electric, Standard (4.4 ft3 or greater capacity)

2. Electric, Compact (120V) (less than 4.4 ft3 capacity)

3. Vented Electric, Compact (240V) (less than 4.4 ft3 capacity)

4. Vented Gas, Standard (4.4 ft3 or greater capacity)

5. Vented Gas, Compact (less than 4.4 ft3 capacity)

6. Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity)

7. Ventless Electric, Combination Washer-Dryer

DOE further notes that product classes established through EPCA’s direct final

rule authority are not subject to the criteria specified at 42 U.S.C. 6295(q)(1) for

establishing product classes. However, in accordance with 42 U.S.C. 6295(o)(4)—which

is applicable to direct final rules—DOE has concluded that the standards adopted in this

direct final rule will not result in the unavailability in any covered product type (or class)

of performance characteristics, features, sizes, capacities, and volumes that are

substantially the same as those generally available in the United States currently.

Additionally, DOE notes that DOE’s findings in this regard are discussed in detail in

section V.B.4 of this document.

2. Technology Options

In this direct final rule, DOE considered the technology options listed in Table

IV.2, consistent with the table of technology options presented in the August 2022

NOPR. 87 FR 51734. Chapter 3 of the TSD for this direct final rule includes a detailed

list and descriptions of all technology options identified for consumer clothes dryers. As

discussed in chapter 3 of the TSD for this direct final rule, DOE has performed market

research and evaluated available consumer clothes dryers to assess existing technology

options to improve efficiency. The results of this research are discussed in chapter 3 of

the TSD for this direct final rule. DOE notes that it did not receive any comments

regarding the technology options analyzed in the August 2022 NOPR.

EPCA specifies that DOE may not prescribe an amended or new standard if the Secretary finds (and

publishes such finding) that interested persons have established by a preponderance of the evidence that the

standard is likely to result in the unavailability in the United States in any covered 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 Secretary’s

finding. (42 U.S.C. 6295(o)(4))

Table IV.2 Direct Final Rule Analysis: Technology Options for Consumer Clothes

Dryers

Dryer Control or Drum Upgrades

Improved termination

Increased insulation

Modified operating conditions

Improved air circulation

Improved drum design

Methods of Exhaust Heat Recovery (Vented Models Only)

Recycle exhaust heat

Inlet air preheat

Inlet air preheat, condensing mode

Moisture Removal Options

Heat pump, electric only

Thermoelectric heating, electric only

Microwave, electric only

Modulating heat

Indirect heating

RF drying, electric only

Ultrasonic drying, electric only

Component Improvements

Improved motor efficiency

Improved fan efficiency

Standby Power Improvements

Transformerless power supply with auto-powerdown

B. Screening Analysis

DOE uses the following screening criteria to determine which technology options

are suitable for further consideration in an energy conservation standards rulemaking:

(1) Technological feasibility. Technologies that are not incorporated in

commercial products or in commercially viable, existing prototypes will not

be considered further.

(2) Practicability to manufacture, install, and service. If it is determined that

mass production of a technology in commercial products and reliable

installation and servicing of the technology could not be achieved on the scale

necessary to serve the relevant market at the time of the projected compliance

date of the standard, then that technology will not be considered further.

(3) Impacts on product utility. If a technology is determined to have a significant

adverse impact on the utility of the product to subgroups of consumers or

result in the unavailability of any covered product type with performance

characteristics (including reliability), features, sizes, capacities, and volumes

that are substantially the same as products generally available in the United

States at the time, it will not be considered further.

(4) Safety of technologies. If it is determined that a technology would have

significant adverse impacts on health or safety, it will not be considered

further.

(5) Unique-pathway proprietary technologies. If a technology has proprietary

protection and represents a unique pathway to achieving a given efficiency

level, it will not be considered further, due to the potential for monopolistic

concerns.

10 CFR part 430, subpart C, appendix A, sections 6(b)(3) and 7(b).

In sum, if DOE determines that a technology, or a combination of technologies,

fails to meet one or more of the listed five criteria, it will be excluded from further

consideration in the engineering analysis. The reasons for eliminating any technology are

discussed in the following sections.

The subsequent sections include DOE’s evaluation of each technology option

against the screening analysis criteria, and whether DOE determined that a technology

option should be excluded (“screened out”) based on the screening criteria.

1. Screened Out Technologies

In conducting the screening analysis for this direct final rule, DOE considered

comments it had received in response to the screening analysis conducted for the August

2022 NOPR.

a. Thermoelectric heating, electric only

DOE notes that thermoelectric heating clothes dryers are still undergoing

preliminary research, including at Oak Ridge National Laboratory (“ORNL”). While

ORNL’s test results of a preliminary prototype have shown the potential for improved

efficiency, ORNL indicated that the initial prototype design produced longer-than-desired

drying times due to direct-contact heat transfer limitations via the drum surface. ORNL

subsequently developed another prototype that added pumped secondary water loops that

transferred heat from the thermoelectric modules to the process air via air-to-water heat

exchangers to further improve efficiency and minimize cycle length. ORNL’s testing

indicated efficiency and cycle times for this prototype that are approximately equivalent

to those of vapor compression heat pump clothes dryers.

Because the research for such

a thermoelectric heating clothes dryer that produces energy savings and meets consumer

expectations for drying cycle time is still in the prototype stage, DOE determined that this

technology option would not be practicable to manufacture, install, and service on a scale

necessary to serve the relevant market at the time of the projected compliance date of any

Patel, V., Boudreaux, P., and Gluesenkamp, K. Oak Ridge National Laboratory. Validated Model of a

Thermoelectric Heat Pump Clothes Dryer Using Secondary Pumped Loops. Applied Thermal Engineering,

Volume 184, February 5, 2021.

new or amended consumer clothes dryer standards, and did not consider it for further

analysis.

b. Microwave, electric only

Due to the large energy savings associated with microwave drying, this

technology was the subject of a multiyear development effort at the Electric Power

Research Institute (“EPRI”) in the mid-1990s.

At least one major manufacturer—

Whirlpool—developed a countertop-scale version of such a product as recently as 2002,

but to date this technology has not been successfully commercialized.

Microwave drying introduces significant technical and safety issues with potential

arcing from metallic objects in the fabric load, including zippers, buttons, or “stray” items

such as coins. While efforts have been made to mitigate the conditions that are favorable

to arcing or to detect incipient arcing and terminate the cycle, the possibility of fabric

damage cannot be completely eliminated.

In addition to those consumer utility impacts,

these conditions can also pose a safety hazard. For these reasons, microwave drying was

not considered further for analysis.

c. Indirect heating

Indirect heating would be viable only in residences that use a hydronic heating

system. Also, in order to derive clothes dryer heat energy from a home’s heating system,

S. Ashley. 1998. “Energy-Efficient Appliances,” Mechanical Engineering Magazine, March 1998, pp.

94–97.

E. Spagat. 2002. “Whirlpool Goes Portable to Sell Dryers to Gen Y,” Wall Street Journal, June 4, 2002.

J.F. Gerling. 2003. “Microwave Clothes Drying—Technical Solutions to Fundamental Challenges,”

Appliance Magazine, April 2003, p. 120.

significant plumbing work would be required to circulate heated water through a heat

exchanger in the clothes dryer. Therefore, this technology option does not meet the

criterion of practicability to install on a scale necessary to serve the relevant market at the

time of the effective date of any new standard and was not considered for further

analysis.

d. RF drying, electric only

CoolDry, LLC (“CoolDry”) developed an RF clothes dryer prototype, claiming an

efficiency of 90 percent, compared to 50 percent for conventional clothes dryers.

CoolDry stated that its RF drying technology operates at lower temperatures than do

conventional clothes dryers and, because the transfer of energy to clothes is not

dependent on convective heat transfer, the RF clothes dryer requires less tumbling and

subsequently consumes less energy for drum rotation than a conventional clothes dryer.

Because this technology was in the prototype stage at the time it was initially considered

and the company is no longer in business, research and development is unlikely to be

ongoing. Therefore, DOE determined that this technology option would not be

practicable to manufacture, install, and service on a scale necessary to serve the relevant

market at the time of the projected compliance date of any new or amended consumer

clothes dryer standards and did not consider it for further analysis.

Cool Dry did not specify the metric or test method used to determine the efficiency of its prototype.

e. Ultrasonic drying, electric only

Researchers at ORNL have developed an ultrasonic drying prototype that uses

piezoelectric transducers to separate water from clothes through water cavitation

produced by ultrasonic vibrations. According to their research, the energy imparted to the

water must overcome surface tension in order to break the water into droplets, but this

energy is substantially less than the latent heat of vaporization of water, which is the

primary thermodynamic barrier for conventional evaporation drying. The ORNL

researchers anticipate that ultrasonic drying technology will result in an energy factor

greater than 10 and a drying time of less than 20 minutes.

Because this technology is

still in the prototype stage, however, DOE determined that this technology option would

not be practicable to manufacture, install, and service on a scale necessary to serve the

relevant market at the time of the projected compliance date of any new or amended

consumer clothes dryer standards and did not consider it for further analysis.

DOE did not receive any comments in response to the August 2022 NOPR

regarding these screened out technology options, and for the reasons discussed, screened

out the same technologies for this direct final rule analysis.

2. Remaining Technologies

Through a review of each technology, DOE tentatively concludes that all of the

other identified technologies listed in section IV.A.2 of this document met all screening

This energy factor incorporates only active mode energy use and not standby mode and off mode energy

use.

Momen, A. Ultrasonic Clothes Dryer: 2016 Building Technologies Office Peer Review. 2016. Prepared

for the U.S. Department of Energy at Oak Ridge National Laboratory, in partnership with the University of

Florida and General Electric, p. 2.

criteria to be examined further as design options in DOE’s direct final rule analysis. In

summary, DOE did not screen out the following technology options:

Table IV.3 Retained Design Options for Consumer Clothes Dryers

Dryer Control or Drum Upgrades

Improved termination

Modified operating conditions

Improved air circulation

Increased insulation

Improved drum design

Methods of Exhaust Heat Recovery (vented models only)

Recycle exhaust heat

Inlet air preheat

Inlet air preheat, condensing mode

Moisture Removal Options

Heat pump, electric only

Modulating heat

Component Improvements

Improved motor efficiency

Improved fan efficiency

Standby Power Improvements

Transformerless Power Supply with Auto-Powerdown

DOE determined that these technology options are technologically feasible

because they are being used or have previously been used in commercially available

products or working prototypes. DOE also finds that all of the remaining technology

options meet the other screening criteria (i.e., practicable to manufacture, install, and

service and do not result in adverse impacts on consumer utility, product availability,

health, or safety). For additional details, see chapter 4 of the direct final rule TSD.

As previously discussed, on February 14, 2024, DOE received a second joint

statement from the same group of stakeholders that submitted the Joint Agreement in

which the signatories reaffirmed the standards recommended in the Joint Agreement.

particular, the letter states that the joint stakeholders do not anticipate the recommended

standards will negatively affect features or performance.

C. Engineering Analysis

The purpose of the engineering analysis is to establish the relationship between

the efficiency and cost of consumer clothes dryers. There are two elements to consider in

the engineering analysis: the selection of efficiency levels to analyze (i.e., the efficiency

analysis) and the determination of product cost at each efficiency level (i.e., the cost

analysis). In determining the performance of higher efficiency products, DOE considers

technologies and design option combinations not eliminated by the screening analysis.

For each product class, DOE estimates the baseline cost, as well as the incremental cost

for the product/equipment at efficiency levels above the baseline. The output of the

engineering analysis is a set of cost-efficiency “curves” that are used in downstream

analyses (i.e., the LCC and PBP analyses and the NIA).

1. Efficiency Analysis

DOE typically uses one of two approaches to develop energy efficiency levels for

the engineering analysis: (1) relying on observed efficiency levels in the market (i.e., the

efficiency-level approach), or (2) determining the incremental efficiency improvements

associated with incorporating specific design options to a baseline model (i.e., the design-

option approach). Using the efficiency-level approach, the efficiency levels established

This document is available in the docket at: www.regulations.gov/comment/EERE-2014-BT-STD-0058-

0058.

for the analysis are determined based on the market distribution of existing products (in

other words, based on the range of efficiencies and efficiency-level “clusters” that

already exist on the market). Using the design-option approach, the efficiency levels

established for the analysis are determined through detailed engineering calculations

and/or computer simulations of the efficiency improvements from implementing specific

design options that have been identified in the technology assessment. DOE may also

rely on a combination of these two approaches. For example, the efficiency-level

approach (based on actual products on the market) may be extended using the design-

option approach to interpolate to define “gap fill” levels (to bridge large gaps between

other identified efficiency levels) and/or to extrapolate to the “max-tech” level

(particularly in cases where the “max-tech” level exceeds the maximum efficiency level

currently available on the market).

For this direct final rule, DOE used an efficiency-level approach, supplemented

with reverse engineering. This approach involved first testing and then physically

disassembling a representative sample of commercially available products, reviewing

publicly available cost information, and modeling equipment cost. From this information

and through the reverse engineering process, DOE estimated the manufacturer production

costs (“MPCs”) for a range of products currently available on the market, considering the

design options and the steps manufacturers would likely take to reach a certain efficiency

level. As part of this analysis, DOE included test units that represent baseline models,

newly introduced units on the market, units with unique configurations, and units with

technologies as observed in the technology assessment. The efficiency levels analyzed as

part of this engineering analysis are attainable using commercially available clothes dryer

technologies, or technologies that have been demonstrated in working prototypes.

a. Baseline Efficiency Levels

For each product/equipment class, DOE generally selects a baseline model as a

reference point for each class, and measures changes resulting from potential energy

conservation standards against the baseline. The baseline model in each

product/equipment class represents the characteristics of a product/equipment typical of

that class (e.g., capacity, physical size). Generally, a baseline model is one that just

meets current energy conservation standards, or, if no standards are in place, the baseline

is typically the most common or least efficient unit on the market.

The baseline clothes dryer efficiency levels for this direct final rule differ from

the existing energy conservation standards that were established in the 2011 rulemaking

analysis primarily due to the difference between the then-current appendix D1, which

DOE used to evaluate products in the previous rulemaking, and the present version of

appendix D2, established in the October 2021 TP Final Rule and which DOE used as the

basis for this analysis. Appendix D2 includes test methods that more accurately measure

the effects of automatic cycle termination and that may result in differences in the total

measured energy consumption of the test cycle as compared to the test methods in

appendix D1. Specifically, for automatic termination control dryers, appendix D2

requires a lower FMC of the test load and does not rely on a field use factor to account

for the over-drying energy consumption, instead requiring that the automatic termination

drying program run to the end of the cycle. Additionally, appendix D2 contains

instructions for the testing of timer dryers, which include a lower FMC of the test load as

compared to the version of appendix D1 used for the 2011 rulemaking analysis.

For the engineering analysis, DOE began by identifying the efficiency level

corresponding to the Federal minimum energy conservation standards for each product

class. Due to the test procedure changes adopted in the October 2021 Final Rule, DOE

determined the baseline efficiency level representative of minimally compliant products

when tested under appendix D2. To identify the appendix D2 baseline levels, DOE tested

22 models that were certified as minimally compliant with the current energy

conservation standards, from across all product classes. Because certified performance

data are not available for models on the market tested in accordance with both appendix

D1 and appendix D2, DOE tested each basic model in its test sample in accordance with

appendix D1 and appendix D2 and used the test values for appendix D2 to determine the

baseline models in support of this engineering analysis. Due to the differences in the two

test procedures previously described, the baseline CEF

measured using appendix D2 is

numerically lower for each product class than the corresponding CEF

value in the

current energy conservation standards, though that does not indicate a lower efficiency.

The test procedure differences drive the lower baseline CEF

values and do not

represent a lower efficiency or backsliding.

With regard to the vented gas compact product class, DOE is unaware of any

currently available commercial products that fall within the vented gas compact product

class. To determine the baseline level for this product class, DOE analyzed a vented gas

compact-size model that was previously available on the market prior to the effective

date of the current energy conservation. DOE’s previous testing of that model—which

utilized electromechanical controls—suggests that the model would not be compliant

with the existing standards. DOE expects that manufacturers would implement electronic

controls as a design option to produce vented gas compact clothes dryers that minimally

comply with the existing standard. DOE determined the efficiency performance that

would be achieved through the addition of electronic controls by applying the same

relative efficiency improvement observed with the implementation of electronic controls

for standard-size vented gas clothes dryers, as shown in Table IV.8 in section IV.C.1.b of

this document. The resulting estimated level of baseline performance for the vented gas

compact product class is consistent with the efficiency level recommended by the Joint

Agreement for this product class.

The baseline efficiency levels considered for this analysis are presented along

with the current standards in Table IV.4 and are discussed in more detail in chapter 5 of

the direct final rule TSD. The baseline values are the same as those proposed in the

August 2022 NOPR, except for the vented gas compact product class as discussed.

Table IV.4 Direct Final Rule Consumer Clothes Dryer Baseline Efficiency Levels

Product Class

CEF

(lb/kWh)

CEF

(lb/kWh)*

(i) Electric, Standard (4.4 ft3 or greater capacity)

3.73

2.20

(ii) Electric, Compact (120V) (less than 4.4 ft3 capacity)

3.61

2.36

(iii) Vented Electric, Compact (240V) (less than 4.4 ft3 capacity)

3.27

2.00

(iv) Vented Gas, Standard (4.4 cubic ft3 or greater capacity)

3.30

2.00

(v) Vented Gas, Compact (less than 4.4 ft3 capacity)

3.30

2.02

(vi) Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity)

2.55

2.03

(vii) Ventless Electric, Combination Washer-Dryer

2.08

2.27

As discussed, the baseline CEF

values represent differences in test procedure between appendix D1 and

appendix D2 and do not constitute backsliding. CEF

baseline efficiency levels as measured under

appendix D2 account for differences in the effectiveness of automatic cycle termination. Manufacturers

implement automatic termination in a variety of ways, which will impact the representations as measured

under appendix D2 and result in a range of possible CEF

values, as compared to the CEF

values in the

existing Federal standards.

b. Incremental Efficiency Levels

DOE developed incremental efficiency levels by reviewing products currently

available on the market and by testing and reverse engineering products in the DOE test

sample in support of the direct final rule. For each product class, DOE analyzed several

efficiency levels and determined the incremental MPC at each of these levels. DOE

initially reviewed data in DOE’s Compliance Certification Database (“CCD”) to evaluate

the range of efficiencies for consumer clothes dryers currently available on the market.

As discussed in chapter 5 of the direct final rule TSD, non-ENERGY STAR-qualified

products (i.e., generally units with lower-rated efficiencies) are typically tested using

appendix D1, while ENERGY STAR-qualified products are required to be tested using

appendix D2. As a result, DOE conducted testing on a representative sample of non-

ENERGY STAR-qualified products using appendix D2 to determine appropriate initial

incremental efficiency levels for each product class. DOE observed that while electronic

controls are typically implemented with other design options in this analysis, the

improved automatic termination precision offered by switching to electronic controls

contributed significantly to an increase in efficiency. This efficiency gain informed the

first incremental efficiency levels for most product classes and was noted simply as

electronic controls in the design options listed in the tables later in this section. The

design options associated with higher efficiency levels were subsequently distinguished

according to specific design options DOE found manufacturers used to meet these higher

efficiencies. As part of DOE’s analysis, the maximum available efficiency level is the

highest efficiency unit currently available on the market. DOE also defines a “max-tech”

efficiency level to represent the maximum possible efficiency for a given product.

For the vented gas compact product class, no units were available on the market at

the time of the analysis whose rated value exceeded the baseline level. Given recent

market trends, DOE does not have reason to expect manufacturers to re-introduce

compact-size vented gas clothes dryers to the market, regardless of amendments to

energy conservation standards. Accordingly, DOE did not consider any higher efficiency

levels for this product class.

In defining the incremental efficiency levels for the other product classes for this

direct final rule, DOE considered comments it had received in response to the

incremental efficiency levels proposed in the August 2022 NOPR, including several from

commenters who support the Joint Agreement.

The CA IOUs supported DOE's decision to adopt the updated max-tech levels as

indicative of the growth and maturity of heat pump technologies for vented and ventless

products. The CA IOUs further commented that adopting the max-tech levels sets a key

precedent for subsequent DOE energy efficiency and non-DOE rulemakings to represent

the true potential of a product class. (California IOUs, No. 50 at pp. 4–5)

AHAM and Whirlpool disagreed with DOE's tentative determination that the

proposed standards in the August 2022 NOPR would allow for electromechanical

controls. AHAM and Whirlpool commented that electronic controls are required to

enable the technology options for the proposed TSL. Whirlpool further commented that

electromechanical control dryers are not sophisticated enough to enable the other

technology options that DOE described in the August 2022 NOPR analysis and therefore

could not be used effectively with the appendix D2 test procedure. Whirlpool stated that

DOE's NOPR analysis missed several key aspects where utility and performance could be

lessened in order to meet the proposed standard levels. Whirlpool noted that the average

CEF score of the five tested units in the vented electric standard product class with

electromechanical controls in the August 2022 NOPR analysis is 2.64 lb/kWh, over 30-

percent lower than the proposed standard. AHAM stated that electromechanical controls

have consumer utility in that they are easy to use and reduce the overall costs associated

with the product, and that requiring electronic controls would result in investment costs

for manufacturers and increased purchase prices for consumers. AHAM requested that

DOE retain electromechanical controls among a consumer's purchase options as,

according to AHAM, they are a desirable feature for reliability, they provide reduced

appliance cost among consumers, and their elimination from the market would likely

cause consumers to postpone the purchase of new dryers, in turn increasing the total

national energy consumption. Whirlpool stated concern regarding a forced regulatory

phaseout of electromechanical controls because they are incorporated in a popular and

affordable segment of consumer clothes dryers, and noted that although some electronic

controls could be “hidden” from the consumer, there could be some lost utility from the

easy and low-cost repairability of electromechanical control dryers. (AHAM, No. 46 at

pp. 5, 10; Whirlpool, No. 53 at pp. 3–4)

DOE is not aware of reliability issues associated with the implementation of

electronic controls relative to electromechanical controls. However, DOE acknowledges

that a transition from electromechanical controls to electronic controls may require

manufacturer investment costs to redesign products and would likely increase purchase

price for consumers, as captured in the incremental costs estimated and presented in this

direct final rule analysis. Based on its analysis for this direct final rule, DOE believes

that component costs associated with the implementation of electronic controls are lower

than those estimated in the August 2022 NOPR analysis, which is reflected in the updated

MPCs for the efficiency levels that entail a shift to electronic controls. These costs are

reflected in the MPCs, which are the basis for the LCC and PBP analyses, in which

consumer impacts related to increased purchase price and repair and maintenance costs

are considered. Additionally, DOE reevaluated repair costs and accordingly implemented

higher repair costs associated with electronic controls in this direct final rule analysis,

consistent with Whirlpool’s comments. See section IV.F of this document and chapter 8

of the direct final rule TSD for additional details.

Regarding the concern that clothes dryers equipped with electromechanical

controls could not be tested under appendix D2, DOE notes that its test sample shows that

requiring the use of the appendix D2 test procedure will not preclude the use of

electromechanical controls. As discussed in chapter 5 of the direct final rule TSD, DOE

tested baseline models with electromechanical controls under appendix D2, where

available. For the ventless electric compact (240V) product class and the ventless electric

combination washer-dryer product class, there were no baseline models identified with

electromechanical controls; however, the same efficiency-level approach was taken to

establish the efficiency-level structures for these product classes. The baseline efficiency

levels in this direct final rule represent a minimally compliant, basic-construction

consumer clothes dryer on the market, such as a dryer with electromechanical controls,

and were set according to the lowest tested values under appendix D2 in each product

class. As Whirlpool noted, the average CEF score of the five tested units in the vented

electric standard product class with electromechanical controls was significantly lower

than the proposed standard, further indicating the efficiency savings associated with a

transition to a combination of electronic controls and higher design options. Regarding

the concern that the proposed amended standards would require the implementation of

electronic controls, DOE reiterates that although it expects that electronic controls are

most likely to be used to achieve higher efficiency levels, and a review of ENERGY

STAR-qualified products suggests increased prevalent use of electronic controls,

manufacturers are not required to implement these specific design options to meet

amended standards. DOE therefore does not expect the amended standards to preclude

electromechanical controls should manufacturers choose to implement them.

Regarding AHAM and Whirlpool’s comments that the required implementation

of electronic controls to reach efficiency levels above the existing standard may result in

a loss of consumer utility associated with the traditional user interface utilizing

electromechanical controls, DOE’s testing and analysis of models currently on the market

confirms Whirlpool’s statement that electronic controls may be “hidden” from consumers

who prefer a more traditional user interface. This may be accomplished by implementing

physical dials for consumer use that in turn manipulate the electronic controls in order to

achieve the efficiency savings associated with electronic controls while providing the

user experience of electromechanical controls. Therefore, even if electronic controls are

utilized, DOE does not expect a loss in consumer utility associated with the use of

electromechanical controls. DOE notes that AHAM recommended the proposed

efficiency levels in the Joint Agreement on behalf of its members, including Whirlpool,

in the Joint Agreement, which includes efficiency levels that can be achieved with the

implementation of electronic controls.

Whirlpool stated that there may be greater visibility and scrutiny of drying times

associated with electronic control clothes dryers among consumers, as electromechanical

control dryers do not display drying times. According to Whirlpool, consumers may

believe they are losing control of their dryers in a way that results in additional energy

consumption, and DOE should account for this possible behavioral shift and lost energy

savings. (Whirlpool, No. 53 at p. 7)

DOE is not aware of any data suggesting that the behavior of consumers of with

clothes dryers utilizing electronic controls results in greater energy use than for

consumers with clothes dryers utilizing electromechanical controls and notes that

electronic controls are typically more efficient than electromechanical controls. As

previously noted, manufacturers currently provide electronic controls that provide the

experience of electromechanical controls through the use of dials which would avoid any

loss in consumer utility.

GEA stated that while the appendix D2 test procedure requires use of the

“normal” or ”medium” dryness setting for the clothes dryer test cycle, most labs,

according to GEA, understand the “optimum” dryness setting to be the “normal” setting

for appendix D2. GEA stated that it provides further clarity to consumers and test labs in

the use and care manual for products with an “optimum” dryness setting by specifying

that optimum is the dryness setting to use for most clothes when running the “cottons”

cycle (the drying cycle recommended for certain consumer clothes dryers manufactured

by GEA for drying cotton). Therefore, based on the cycle settings provided by the

additional test information DOE published on October 13, 2022, and information

provided by Guidehouse to GEA under a non-disclosure agreement, GEA stated that

DOE incorrectly tested two models in its test sample and urged DOE to either rerun its

testing, exclude the models in question from its analysis, or accept the data provided by

GEA and adjust its savings model. (GEA, No. 49 at pp. 2–3)

DOE notes that the baseline units GEA referenced are certified under appendix

D1, and although these units were not originally intended to be tested under the appendix

D2 test procedure, DOE tested them using the appropriate cycle settings under the

appendix D2 test procedure to support the engineering analysis. These settings were

different than the “optimum” dryness setting specified in the use and care manual for

these particular units. Although GEA referred to specific cycle settings for consumer

use, DOE notes that this instruction for cycle settings does not supersede the

requirements of the appendix D2 test procedure. Additionally, DOE notes that the test

cycle settings used were within the range anticipated and not expressly warned against by

the owner’s manual or use and care manual. Therefore, DOE maintains that the correct

cycle settings were used to test the units in question.

Whirlpool stated that DOE should have presented the cycle times before and after

wrinkle prevention mode was enabled for models in the test sample that had wrinkle

prevention mode on by default. Whirlpool further stated that models reported in the data

had extremely long cycle times, between 88 and 319 minutes, but that such times were

distorted due to testing with wrinkle protection mode enabled. Additionally, Whirlpool

stated that testing of consumer clothes dryers with wrinkle prevention mode enabled by

default may have distorted some of the tested settings and the resulting CEF scores

because wrinkle prevention results in additional cycle time of continuous tumbling after

the heating element has been turned off. Whirlpool stated that, this results in an energy

penalty as the additional cycle time potentially allows for moisture absorption in the test

load to the point of failing to meet the required FMC of 2 percent, and therefore a retest is

required using the highest dryness level setting associated with more energy consumption

and thus a lower average measured CEF. Whirlpool further stated that wrinkle prevention

mode does not produce an accurate comparison of average cycle times and CEF scores of

these dryers compared to other dryers that do not have wrinkle prevention modes enabled

by default, and DOE should have also recorded the CEF scores, FMC, and drying times

of these models before they were allowed to enter wrinkle prevention mode. Whirlpool

stated that this data should have been used to inform comparisons between dryers and the

development of baseline efficiency levels. Whirlpool stated that if these dryers were

designed to the appendix D2 test procedure, wrinkle prevention mode would likely not

have been enabled by default. (Whirlpool, No. 53 at pp. 9–10)

In the August 2013 TP Final Rule, DOE clarified that if a clothes dryer is

equipped with a wrinkle prevention mode that is activated by default in the as-shipped

position, the cycle shall be considered complete after the end of the wrinkle prevention

mode. 76 FR 49607, 49623–49624. Although wrinkle prevention mode may have been

disabled had the test units been designed for appendix D2 testing, DOE stated previously

that accurate testing of existing baseline units according to the appendix D2 test

procedure was essential for the analysis, including the use of optional cycle settings that

are enabled by default and that do not affect the program, temperature, or dryness

settings. The test procedure in appendix D2 therefore requires that testing include

wrinkle prevention mode if it is enabled by default. DOE maintains, as it was unable to

predict or assume the cycle settings Whirlpool would have selected had the test units

been designed for appendix D2 testing, that the test units in question were properly tested

in accordance with appendix D2 using the correct cycle settings consistent with the DOE

test procedure.

Chapter 5 of the direct final rule TSD discusses the incremental efficiency levels

for each of the product classes in this analysis. The revised CEF

efficiency levels for

each product class are shown below in Table IV.5 through Table IV.10, along with the

current energy conservation standards in CEF

for comparison. As discussed in section

IV.C.1.a of this document, the baseline CEF

values estimated for the preliminary

analysis are lower than the current CEF

values in the energy conservation standards due

to the differences in testing between appendix D1 and appendix D2.

Table IV.5 Direct Final Rule Analysis: Electric Standard Efficiency Levels

Efficiency

Level

(“EL”)

Design Option

Current

Standard

CEF

(lb/kWh)

DFR

CEF

(lb/kWh)

Baseline

Baseline (Electromechanical Controls)

3.73

2.20

Baseline + Electronic Controls

2.68

EL1 + Optimized Heating System

3.04

EL2 + More Advanced Automatic Termination Control System

3.27

EL3 + Modulating (2-Stage) Heat

3.93

EL4 + Inlet Air Preheat

4.21

Hybrid Heat Pump Dryer (Additional Resistance Heater)

5.20

Heat Pump Dryer (Max-Tech)

7.39

As discussed above, the baseline CEF

values represent differences in test procedure between appendix

D1 and appendix D2 and do not constitute backsliding.

Table IV.6 Direct Final Rule Analysis: Electric Compact (120V) - Efficiency Levels

Efficiency

Level

Design Option

Current

Standard

CEF

(lb/kWh)

DFR

CEF

(lb/kWh)

Baseline

Baseline (Electromechanical Controls)

3.61

2.36

Baseline + Electronic Controls

3.15

EL1 + Optimized Heating System

3.35

EL2 + More Advanced Automatic Termination Control System

4.28

EL3 + Modulating (2-Stage) Heat

4.33

EL4 + Inlet Air Preheat

4.63

Heat Pump Dryer (Max-Tech)

6.37

DOE is aware of consumer clothes dryers in the electric standard product class that perform at higher

efficiencies than the proposed max-tech level, but those models are not representative of the typical

capacity in the electric standard product class. Therefore, based on the certified performance of those

models and additional investigative testing, DOE determined a representative max-tech efficiency for the

electric standard product class that reflects an appropriate, representative unit capacity. See chapter 5 of the

final rule TSD for more information.

Table IV.7 Direct Final Rule Analysis: Vented Electric Compact (240V) Efficiency

Levels

Efficiency

Level

Design Option

Current

Standard

CEF

(lb/kWh)

DFR

CEF

(lb/kWh)

Baseline

Baseline (Electromechanical Controls)

3.27

2.00

Baseline + Electronic Controls

2.44

EL1 + Optimized Heating System

2.76

EL2 + More Advanced Automatic Termination Control System

3.30

EL3 + Modulating (2-Stage) Heat

3.57

EL4 + Inlet Air Preheat

3.82

Heat Pump Dryer (Max-Tech)

3.91

Table IV.8 Direct Final Rule Analysis: Vented Gas Standard Efficiency Levels

Efficiency

Level

Design Option

Current

Standard

CEF

(lb/kWh)

DFR

CEF

(lb/kWh)

Baseline

Baseline (Electromechanical Controls)

3.30

2.00

Baseline + Electronic Controls

2.44

EL1 + Optimized Heating System and More

Advanced Automatic Termination Control

System

3.00

EL2 + Modulating (2-Stage) Heat

3.48

EL3 + Inlet Air Preheat (Max-Tech)

3.83

Table IV.9 Direct Final Rule Analysis: Ventless Electric Compact (240V) Efficiency

Levels

Efficiency

Level

Design Option

Current

Standard

CEF

(lb/kWh)

DFR

CEF

(lb/kWh)

Baseline

Baseline (Electronic Controls)

2.55

2.03

Baseline + More Advanced Automatic Termination Control

System

2.68

Heat Pump Dryer (Max-Tech)

6.80

The current standard does not distinguish a separate product class for compact-size gas consumer clothes

dryers. As such, the current standard may apply to all gas consumer clothes dryers.

Table IV.10 Direct Final Rule Analysis: Ventless Electric Combination Washer-

Dryer Efficiency Levels

Efficiency

Level

Design Option

Current

Standard

CEF

(lb/kWh)

DFR

CEF

(lb/kWh)

Baseline

Baseline (Electronic Controls)

2.08

2.27

Baseline + High-Speed Spin

2.33

Heat Pump Dryer (Max-Tech)

4.01

2. Cost Analysis

The cost analysis portion of the engineering analysis is conducted using one or a

combination of cost approaches. The selection of cost approach depends on a suite of

factors, including the availability and reliability of public information, characteristics of

the regulated product, and the availability and timeliness of purchasing the product on the

market. The cost approaches are summarized as follows:

● Physical teardowns: Under this approach, DOE physically dismantles a

commercially available product, component by component, to develop a

detailed bill of materials for the product.

● Catalog teardowns: In lieu of physically deconstructing a product, DOE

identifies each component using parts diagrams (available from manufacturer

websites or appliance repair websites, for example) to develop the bill of

materials for the product.

● Price surveys: If neither a physical nor catalog teardown is feasible (for

example, for tightly integrated products such as fluorescent lamps, which are

infeasible to disassemble and for which parts diagrams are unavailable) or

cost-prohibitive and otherwise impractical (e.g., large commercial boilers),

DOE conducts price surveys using publicly available pricing data published

on major online retailer websites and/or by soliciting prices from distributors

and other commercial channels.

In the present case, DOE conducted the analysis using physical product teardowns

to determine the baseline MPC for each product class as outlined in chapter 5 of the

direct final rule TSD. DOE developed the cost-efficiency relationships for each product

class as discussed in section IV.C.3 of this document. DOE developed incremental

MPCs based on product teardowns and manufacturing cost modeling of the expected

design changes at each efficiency level. DOE observed that the basic product designs of

vented electric and vented gas clothes dryers are similar except for the heating system.

DOE also observed that the technology designs of standard-size and compact-size

consumer clothes dryers are similar as well, simply scaled in size. As a result, in the

absence of models available on the market at certain efficiency levels for certain product

classes, DOE estimated the incremental MPC for these based on the same design changes

observed for the electric standard product class. DOE updated the cost-efficiency

analysis from the preliminary analysis by updating the costs of raw materials and

purchased components, as well as updating costs for manufacturing equipment, labor, and

depreciation. DOE also used information from the teardown of units in the updated test

sample to inform updates to the cost-efficiency analysis. Not all units in the updated test

sample were torn down; DOE focused on units recently introduced in the market, units

with unique configuration, and units with technologies that were not available at the time

of the preliminary analysis to better inform the costs associated with particular product

classes and design options.

The resulting bill of materials provides the basis for the MPC estimates in this

direct final rule. The baseline MPCs for each consumer clothes dryer product class are

listed in Table IV.11, with all costs presented in 2022 dollars.

Table IV.11 Direct Final Rule Analysis: Consumer Clothes Dryer Baseline

Manufacturer Production Costs

Product Class

Baseline MPC

(2022$)

(i) Electric, Standard (4.4 cubic feet (ft3) or greater capacity)

$268.90

(ii) Electric, Compact (120 volts (V)) (less than 4.4 ft3 capacity)

$284.06

(iii) Vented Electric, Compact (240V) (less than 4.4 ft3 capacity)

$284.91

(iv) Vented Gas, Standard (4.4 cubic ft3 or greater capacity)

$303.39

(v) Vented Gas, Compact (less than 4.4 ft3 capacity)

$329.94

(vi) Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity)

$453.09

(vii) Ventless Electric, Combination Washer-Dryer

$611.19

To account for manufacturers’ non-production costs and profit margin, DOE

applies a multiplier (the manufacturer markup) to the MPC. The resulting manufacturer

selling price (“MSP”) is the price at which the manufacturer distributes a unit into

commerce. DOE developed an average manufacturer markup by examining the annual

Securities and Exchange Commission (“SEC”) 10-K reports filed by publicly traded

manufacturers primarily engaged in appliance manufacturing and whose combined

product range includes consumer clothes dryers.

See section IV.J.2.d of this document

U.S. Securities and Exchange Commission, Electronic Data Gathering, Analysis, and Retrieval

(“EDGAR”) system. Available at www.sec.gov/edgar/search/ (last accessed April 21, 2023).

and chapter 12 of the direct final rule TSD for additional information on the manufacturer

markup.

3. Cost-Efficiency Results

The results of the engineering analysis are presented as cost-efficiency data for

each of the efficiency levels for each of the product classes that were analyzed, as well as

those extrapolated from a product class with similar features. DOE developed estimates

of MPCs for each unit in the teardown sample to develop a comprehensive set of

incremental MPCs (i.e., the additional costs manufacturers would likely incur by

producing consumer clothes dryers at each efficiency level compared to the baseline).

The resulting incremental MPCs from this analysis are provided in Table IV.12

through Table IV.17. See chapter 5 of the direct final rule TSD for additional detail on

the engineering analysis.

Table IV.12 Direct Final Rule Analysis: Electric Standard Incremental

Manufacturer Production Costs

Efficiency

Level

Design Option

Incremental

MPC

(2022$)

Baseline

Baseline (Electromechanical Controls)

Baseline + Electronic Controls

$5.60

EL1 + Optimized Heating System

$8.60

EL2 + More Advanced Automatic Termination Control System

$9.15

EL3 + Modulating (2-Stage) Heat

$15.19

EL4 + Inlet Air Preheat

$60.11

Hybrid Heat Pump Dryer (Additional Resistive Heater)

$231.01

Heat Pump Dryer (Max-Tech)

$240.85

Table IV.13 Direct Final Rule Analysis: Electric Compact (120V) Incremental

Manufacturer Production Costs

Efficiency

Level

Design Option

Incremental

MPC

(2022$)

Baseline

Baseline (Electromechanical Controls)

Baseline + Electronic Controls

$7.00

EL1 + Optimized Heating System

$11.81

EL2 + More Advanced Automatic Termination Control System

$12.63

EL3 + Modulating (2-Stage) Heat

$19.43

EL4 + Inlet Air Preheat

$70.28

Heat Pump Dryer (Max-Tech)

$225.41

Table IV.14 Direct Final Rule Analysis: Vented Electric Compact (240V)

Incremental Manufacturer Production Costs

Efficiency

Level

Design Option

Incremental

MPC

(2022$)

Baseline

Baseline (Electromechanical Controls)

Baseline + Electronic Controls

$7.63

EL1 + Optimized Heating System

$12.43

EL2 + More Advanced Automatic Termination Control System

$13.26

EL3 + Modulating (2-Stage) Heat

$20.06

EL4 + Inlet Air Preheat

$70.90

Heat Pump Dryer (Max-Tech)

$226.03

Table IV.15 Direct Final Rule Analysis: Vented Gas Standard Incremental

Manufacturer Production Costs

Efficiency

Level

Design Option

Incremental

MPC

(2022$)

Baseline

Baseline (Electromechanical Controls)

Baseline + Electronic Controls

$9.64

EL1 + Optimized Heating System and More Advanced

Automatic Termination Control System

$11.55

EL2 + Modulating (2-Stage) Heat

$21.59

EL3 + Inlet Air Preheat (Max-Tech)

$66.52

Table IV.16 Direct Final Rule Analysis: Ventless Electric Compact (240V)

Incremental Manufacturer Production Costs

Efficiency

Level

Design Option

Incremental

MPC

(2022$)

Baseline

Baseline (Electronic Controls)

Baseline + More Advanced Automatic Termination

Control System

$2.35

Heat Pump Dryer (Max-Tech)

$196.51

Table IV.17 Direct Final Rule Analysis: Ventless Electric Combination Washer-

Dryer Incremental Manufacturer Production Costs

Efficiency

Level

Design Option

Incremental

MPC

(2022$)

Baseline

Baseline (Electronic Controls)

Baseline + High-Speed Spin

$0.00*

Heat Pump Dryer (Max-Tech)

$420.04

Most ventless electric combination washer-dryers are already equipped with a spin-only mode option as a

standard feature resulting in an incremental MPC of $0.00 for this design option.

The markups analysis D. Markups Analysis

develops appropriate markups (e.g., manufacturer markups, retailer markups,

distributor markups, contractor markups) in the distribution chain and sales taxes to

convert the MSP estimates derived in the engineering analysis to consumer prices, which

are then used in the LCC and PBP analysis. At each step in the distribution channel,

companies mark up the price of the product to cover business costs and profit margin.

DOE considered two distribution channels through which consumer clothes

dryers move from manufacturers to consumers. The majority of consumer clothes dryer

sales go through the direct retailer channel, in which manufacturers sell the products

directly to retailers, who then sell to consumers. This direct retailer channel accounts for

90 percent of the consumer clothes dryer market. The rest of the market goes through a

separate new construction distribution channel, in which manufacturers sell the products

to wholesalers, who in turn sell the products to general contractors, then to consumers.

The main parties in the post-manufacturer distribution channels are retailers, wholesalers,

and contractors.

DOE developed baseline and incremental markups for each actor in the

distribution channels. Baseline markups are applied to the price of products with baseline

efficiency, while incremental markups are applied to the difference in price between

baseline and higher efficiency models (the incremental cost increase). The incremental

markup is typically less than the baseline markup and is designed to maintain similar per-

unit operating profit before and after new or amended standards.

DOE relied on economic data from the U.S. Census Bureau to estimate average

baseline and incremental markups. Specifically, DOE used the 2017 Annual Retail Trade

Survey for the “electronics and appliance stores” sector to develop retailer markups;

the

2017 Annual Wholesale Trade Survey for “household appliances, and electrical and

electronic goods merchant wholesalers” to estimate wholesaler markups;

and the 2017

Economic Census for the residential construction sector to derive general contractor

markups.

Because the projected price of standards-compliant products is typically higher than the price of baseline

products, using the same markup for the incremental cost and the baseline cost would result in higher per-

unit operating profit. While such an outcome is possible, DOE maintains that in markets that are

reasonably competitive it is unlikely that standards would lead to a sustainable increase in profitability in

the long run.

U.S. Census Bureau, Annual Retail Trade Survey. 2017. Available at www.census.gov/programs-

surveys/arts.html (last accessed Feb. 1, 2022).

U.S. Census Bureau, Annual Wholesale Trade Survey. 2017. Available at

www.census.gov/wholesale/index.html (last accessed Feb. 1, 2022).

U.S. Census Bureau. 2017 Economic Census: Construction Industry Series: Detailed Statistics for

Establishments: 2017. New Single-Family General Contractors, New Multifamily Housing Construction

Chapter 6 of the direct final rule TSD provides details on DOE’s development of

markups for consumer clothes dryers.

E. Energy Use Analysis

The purpose of the energy use analysis is to determine the annual energy

consumption of consumer clothes dryers at different efficiencies in representative U.S.

single-family homes, multifamily residences, and mobile homes and to assess the energy

savings potential of increased consumer clothes dryer efficiency. The energy use

analysis estimates the range of energy use of consumer clothes dryers in the field (i.e., as

they are actually used by consumers). The energy use analysis provides the basis for

other analyses DOE performed, particularly assessments of the energy savings and the

savings in consumer operating costs that could result from adoption of amended or new

standards.

In conducting the energy use analysis for this direct final rule, DOE considered

comments it had received in response to the proposed analysis in the August 2022 NOPR.

DOE received a comment from AHAM regarding the number of annual use cycles in the

August 2022 NOPR energy use analysis. AHAM requested that DOE review the 2020

Residential Energy Consumption Survey (“2020 RECS”) data

and adjust the annual

number of cycles accordingly. AHAM stated that it previously commented that RECS

2015 suggested an annual number of cycles of 236 as opposed to the 283 cycles in the

(Except Operative Builders), New Housing Operative Builders, and Residential Remodelers. Sector 23:

236115 through 236118. 2017. U.S. Census.

The Residential Energy Consumption Survey 2020 data is available at

www.eia.gov/consumption/residential/data/2020/.

current test procedure, which is consistent with the observation that clothes washer cycles

have decreased in number to 234 cycles per year using the 2015 RECS. According to

AHAM, it does not make sense for clothes washer cycles to decrease and clothes dryer

cycles to increase or even stay the same. AHAM suggested that based on the 2020

RECS, the annual number of cycles should be 209. (AHAM, No. 46 at p. 12)

In the August 2022 NOPR analysis, DOE used data from the EIA’s 2015

Residential Energy Consumption Survey (“2015 RECS”) to establish a reasonable range

of energy consumption in the field for consumer clothes dryers. DOE noted that the

microdata for the 2020 RECS was not available at the time the NOPR analysis was

conducted but stated that it would update the underlying data to 2020 RECS if it was

available prior to the final rule. 87 FR 51762. DOE is aware that the 2020 RECS has

been published.

This survey collected data from 18,496 housing units and was designed

by EIA to represent the household population in the United States. Therefore, DOE has

integrated this data into its analysis for the direct final rule concerning households using

clothes dryers.

DOE divided the sample of households into four subsamples for the product

classes being analyzed: standard or compact consumer clothes dryers using electricity or

natural gas as the dryer fuel. For compact consumer clothes dryers, DOE developed a

U.S. Department of Energy – Energy Information Administration, Residential Energy

Consumption Survey: 2020 Public Use Data Files. Available at

www.eia.gov/consumption/residential/data/2020/index.php?view=microdata (last accessed April 21, 2023).

subsample consisting of households with an electric or gas clothes dryer in multifamily

buildings, manufactured homes, and single-family homes with less than 1,000 square feet

and no garage or basement, since these products are most likely to be found in these

housing types.

The energy use analysis requires DOE to establish a range of total annual usage

(number of cycles) in order to estimate annual energy consumption by a clothes dryer.

DOE estimated the number of clothes dryer cycles per year for each sample household

using data from the 2020 RECS on the number of laundry loads washed (clothes washer

cycles) per week and the frequency of clothes dryer use. The average annual energy

consumption was then calculated, reflecting an average annual sample-weighted usage of

213 cycles per year.

For each considered efficiency level, DOE derived the field energy use by

separately estimating the active mode and standby mode energy use and then adding

them together. The per-cycle active mode energy consumption was estimated using the

DOE clothes dryer test procedure at appendix D2. It was then back calculated from the

test procedure results by dividing the weight (lb) of clothes dried per-cycle (i.e., 8.45 lb

for standard and 3 lb for compact consumer clothes dryers) by the CEF

(lb/kWh) and

subtracting standby power. DOE adjusted the test procedure energy use to reflect field

conditions by making an adjustment for clothes dryer load weight and moisture removal

factor. Chapter 7 of the direct final rule TSD provides more detail about these

calculations.

DOE also considered the impact of clothes dryer operation on home heating and

cooling loads, given that a clothes dryer releases heat to the surrounding environment. If

the clothes dryer is located indoors, its use will tend to slightly reduce the heating load

during the heating season and slightly increase the cooling load during the cooling

season. To calculate this impact, DOE first estimated whether the clothes dryer in a

RECS sample home is located in conditioned space (referred to as “indoors”) or in

unconditioned space (e.g., garages, unconditioned basements, outdoor utility closets, or

attics). Based on the 2020 RECS and the 2019 American Housing Survey (“AHS”),

DOE assumed that 50 percent of vented standard electric and gas consumer clothes

dryers are located indoors, while 100 percent of compact and ventless consumer clothes

dryers are located indoors. For these installations, DOE used the results from a European

Union study about the impacts of consumer clothes dryers on home heating and cooling

loads to determine the appropriate factor to apply to the total clothes dryer energy use.

This study reported that for vented consumer clothes dryers, there is a factor of negative 3

to 9 percent (average 3 percent), and for ventless consumer clothes dryers there is a factor

of positive 7 to 15 percent (average 11 percent).

This effect is likely to be

U.S. Census Bureau: Housing and Household Economic Statistics Division, American Housing Survey

National Data. 2019, HUD. Available at www.census.gov/programs-surveys/ahs/data/2019/ahs-2019-

public-use-file--puf-.html (last accessed April 6, 2023).

Rüdenauer, I. and C.-O. Gensch, Energy demand of tumble driers with respect to differences in

technology and ambient conditions, January 13, 2004. European Committee of Domestic Equipment

Manufacturers (CECED).

For units that are located in conditioned space, a negative factor for vented consumer clothes dryers

translates to a penalty in energy use, whereas a positive factor for ventless consumer clothes dryers

translates to a credit in energy use. For details of the calculations, see the Rüdenauer and Gensch study

referenced above.

approximately the same for all of the considered efficiency levels because the amount of

air passing through the clothes dryer does not vary.

Chapter 7 of the direct final rule TSD provides details on DOE’s energy use

analysis for consumer clothes dryers.

F. Life-Cycle Cost and Payback Period Analysis

DOE conducted LCC and PBP analyses to evaluate the economic impacts on

individual consumers of potential energy conservation standards for consumer clothes

dryers. The effect of new or amended energy conservation standards on individual

consumers usually involves a reduction in operating cost and an increase in purchase

cost. DOE used the following two metrics to measure consumer impacts:

● The LCC is the total consumer expense of an appliance or product over the life

of that product, consisting of total installed cost (manufacturer selling price,

distribution chain markups, sales tax, and installation costs) plus operating

costs (expenses for energy use, maintenance, and repair). To compute the

operating costs, DOE discounts future operating costs to the time of purchase

and sums them over the lifetime of the product.

● The PBP is the estimated amount of time (in years) it takes consumers to

recover the increased purchase cost (including installation) of a more efficient

product through lower operating costs. DOE calculates the PBP by dividing

the change in purchase cost at higher efficiency levels by the change in annual

operating cost for the year that amended or new standards are assumed to take

effect.

For any given efficiency level, DOE measures the change in LCC relative to the

LCC in the no-new-standards case, which reflects the estimated efficiency distribution of

consumer clothes dryers in the absence of new or amended energy conservation

standards. In contrast, the PBP for a given efficiency level is measured relative to the

baseline product.

For each considered efficiency level in each product class, DOE calculated the

LCC and PBP for a nationally representative set of housing units. As stated previously,

DOE developed household samples from the 2020 RECS. For each sample household,

DOE determined the energy consumption for the consumer clothes dryers and the

appropriate energy price. By developing a representative sample of households, the

analysis captured the variability in energy consumption and energy prices associated with

the use of consumer clothes dryers.

Inputs to the calculation of total installed cost include the cost of the product—

which includes MPCs, manufacturer markups, retailer and distributor markups, and sales

taxes—and installation costs. Inputs to the calculation of operating expenses include

annual energy consumption, energy prices and price projections, repair and maintenance

costs, product lifetimes, and discount rates. DOE created distributions of values for

product lifetime, discount rates, and sales taxes, with probabilities attached to each value,

to account for their uncertainty and variability.

The computer model DOE uses to calculate the LCC relies on a Monte Carlo

simulation to incorporate uncertainty and variability into the analysis. The Monte Carlo

simulations randomly sample input values from the probability distributions and

consumer clothes dryer user samples. For this rulemaking, the Monte Carlo approach is

implemented in MS Excel together with the Crystal Ball

add-on.

The model

calculated the LCC for products at each efficiency level for 10,000 housing units per

simulation run. The analytical results include a distribution of 10,000 data points

showing the range of LCC savings for a given efficiency level relative to the no-new-

standards case efficiency distribution. In performing an iteration of the Monte Carlo

simulation for a given consumer, product efficiency is chosen based on its probability. If

the chosen product efficiency is greater than or equal to the efficiency of the standard

level under consideration, the LCC calculation reveals that a consumer is not impacted by

the standard level. By accounting for consumers who already purchase more efficient

products, DOE avoids overstating the potential benefits from increasing product

efficiency. DOE calculated the LCC and PBP for consumers of consumer clothes dryers

as if each were to purchase a new product in the first year of required compliance with

new or amended standards. New and amended standards apply to consumer clothes

dryers manufactured 3 years after the date on which any new or amended standard is

published. (42 U.S.C. 6295(m)(4)(A)(i)) Therefore, DOE used 2027 as the first year of

compliance with any amended standards for consumer clothes dryers for all the TSLs

Crystal Ball

is a commercially available software tool to facilitate the creation of these types of models

by generating probability distributions and summarizing results within Excel, available at

www.oracle.com/technetwork/middleware/crystalball/overview/index.html (last accessed May 17, 2023).

other than TSL 3. For TSL 3, DOE used 2028 as the first year of compliance for all

product classes as specified for the Recommended TSL in the Joint Agreement.

Table IV.18 summarizes the approach and data DOE used to derive inputs to the

LCC and PBP calculations. The subsections that follow provide further discussion.

Details of the spreadsheet model, and of all the inputs to the LCC and PBP analyses, are

contained in chapter 8 of the direct final rule TSD and its appendices.

Table IV.18 Summary of Inputs and Methods for the LCC and PBP Analysis

Inputs

Source/Method

Product Costs

Derived by multiplying MPCs by manufacturer and retailer markups and sales

tax or by manufacturer, wholesaler, and general contractor markups and sales

tax, as appropriate. Used historical data to derive a price scaling index to project

product costs.

Installation Costs

Baseline installation cost determined with data from RSMeans Residential Cost

Data 2022. Assumed no change with efficiency level.

Annual Energy Use

Total per-cycle energy use multiplied by the cycles per year. Average number of

cycles based on field data.

Variability: Based on the 2020 RECS (dryer usage), market data on remaining

moisture content (RMC), and load weights.

Energy Prices

Electricity: Based on EIA’s Form 861 data for 2022.

Variability: Regional energy prices by Census Division.

Energy Price Trends

Based on AEO2023 energy price projections.

Repair and

Maintenance Costs

Repair costs vary between electromechanical and electronic control timers.

Product Lifetime

Average: 14 years

Discount Rates

Approach involves identifying all possible debt or asset classes that might be

used to purchase the considered appliances or that might be affected indirectly.

Primary data source was the Federal Reserve Board’s Survey of Consumer

Finances.

Compliance Date

TSL 1, TSL 2, TSL 4, TSL 5, and TSL 6: 2027

TSL 3 (The Recommended TSL): 2028

* Not used for PBP calculation. References for the data sources mentioned in this table are provided in the following

sections or in chapter 8 of the direct final rule TSD.

For this direct final rule, DOE considered comments it had received regarding the

methodology for evaluating consumer economic impact that were submitted in response

to the August 2022 NOPR. The approach used for this direct final rule is largely the same

approach DOE had used for the August 2022 NOPR analysis.

In response to the August 2022 NOPR AHAM recommended that DOE modify

the way consumer economic impact is analyzed and look at the probability that individual

consumers will benefit from standards rather than whether the aggregate benefit is

positive. (AHAM, No. 46 at p. 13)

In the LCC analysis, DOE notes that it does estimate the impact of potential

standards on individual consumers in the household sample and considers the share of

consumers that would benefit from a standard as part of its evaluation regarding whether

particular standards are economically justified.

1. Product Cost

To calculate consumer product costs, DOE multiplied the MPCs developed in the

engineering analysis by the markups described previously (along with sales taxes). DOE

used different markups for baseline products and higher efficiency products because

DOE applies an incremental markup to the increase in MSP associated with higher

efficiency products.

Economic literature and historical data suggest that the real costs of many

products may trend downward over time according to “learning” or “experience” curves.

Experience curve analysis implicitly includes factors such as efficiencies in labor, capital

investment, automation, materials prices, distribution, and economies of scale at an

industry-wide level. To derive the learning rate parameter for consumer clothes dryers,

DOE obtained historical Producer Price Index (“PPI”) data from the Bureau of Labor

Statistics (“BLS”) for “household laundry equipment” between 1947 and 2016 and

“major household appliance: primary products” between 2016 and 2022 to form a time

series price index representing household laundry equipment from 1947 to 2022.

Inflation-adjusted price indices were calculated by dividing the PPI series by the gross

domestic product index from the Bureau of Economic Analysis for the same years.

Using this data from 1947 to 2022, the estimated learning rate (defined as the fractional

reduction in price from each doubling of cumulative production) is 17.2 percent.

For this direct final rule, DOE considered comments it had received regarding the

methodology for calculating consumer product costs that were submitted in response to

the August 2022 NOPR. The approach used for this direct final rule is largely the same

approach DOE had used for the August 2022 NOPR analysis.

In response to the August 2022 NOPR, AHAM stated that DOE’s pricing

estimates are incorrect because currently, publicly available retail market prices for the

lowest-priced units (many of which are equipped with electromechanical controls) are

approximately $400, and DOE’s estimate for a baseline standard electric unit is $607.

(AHAM, No. 46 at pp. 5–6, 8)

Whirlpool stated that DOE does not consider retail prices for models actually

being sold in the market today that meet varying efficiency levels and actually utilize

technology options needed to meet TSL 3. Whirlpool commented that retail price

differences between $200 and $300 may be a better reflection of the expected price

“Household laundry equipment” PPI (PCU3352203352204) is available through May 2016, and “major

household appliance: primary products” PPI (PCU335220335220P) is available from May 2016 to present.

See more information at www.bls.gov/ppi/ (last accessed Nov. 29, 2021).

premiums for consumers from amended standards than DOE’s analysis and methodology.

(Whirlpool, No. 53 at p. 7)

In response, DOE notes that the actual retail price differences between a baseline

and higher efficiency level currently on the market may include the price for other

premium features in addition to engineering designs relating to efficiency. Additionally,

retail prices reflect economies of scale in production as well as marketing strategies and

profit margins of manufacturers and retailers. DOE maintains that its traditional

approach, which has been subject to peer review, is better able to identify the incremental

costs that are only connected to higher efficiency. Furthermore, in this direct final rule

analysis, DOE leveraged web scraping to gather data on clothes dryer models available

on the market from January to March 2023. The data was collected from major retail

outlets, including Best Buy, Lowe’s, and AJ Madison. DOE found that the lowest-priced

baseline model cost $630. DOE therefore concluded that its baseline estimate for a

standard electric unit is reasonable for this direct final rule.

2. Installation Cost

Installation cost includes labor, overhead, and any miscellaneous materials and

parts needed to install the product. DOE used data from RSMeans Residential Cost Data

to estimate the baseline installation cost for consumer clothes dryers.

DOE estimated

that for the new construction market, it takes, on average, 1 hour to install a clothes dryer,

while for the replacement or new-owner market, it takes 2.5 hours (i.e., 1 hour for the trip

RSMeans Online Residential Data (2022 Release). Gordian: Greenville, SC. Available at

www.rsmeansonline.com (last accessed April 6, 2023).

charge, 30 minutes to remove the old clothes dryer, and 1 hour to install). DOE found no

evidence that increased efficiency levels would impact installation costs.

3. Annual Energy Consumption

For each sampled household, DOE determined the energy consumption for a

consumer clothes dryer at different efficiency levels using the approach described

previously in section IV.E of this document.

4. Energy Prices

Because marginal electricity and gas prices more accurately capture the

incremental savings associated with a change in energy use from higher efficiency, they

provide a better representation of incremental change in consumer costs than average

electricity and gas prices. Therefore, DOE applied average electricity and gas prices for

the energy use of the product purchased in the no-new-standards case, and marginal

electricity and gas prices for the incremental change in energy use associated with the

other efficiency levels considered.

DOE derived electricity prices in 2022 using data from EEI Typical Bills and

Average Rates reports. Based upon comprehensive, industry-wide surveys, this semi-

annual report presents typical monthly electric bills and average kilowatt-hour costs to

the customer as charged by investor-owned utilities. For the residential sector, DOE

calculated electricity prices using the methodology described in Coughlin and Beraki

(2018).

DOE obtained data for calculating regional prices of natural gas from the EIA

publication Natural Gas.

This publication presents monthly volumes of natural gas

deliveries and average prices by state for residential, commercial, and industrial

customers.

DOE's methodology allows electricity and gas prices to vary by sector, region,

and season. In the analysis, variability in electricity and gas prices is chosen to be

consistent with the way the consumer economic and energy use characteristics are

defined in the LCC analysis. For consumer clothes dryers, DOE calculated weighted

average values for average and marginal electricity and gas price for the nine census

divisions. See chapter 8 of the direct final rule TSD for details.

To estimate energy prices in future years, DOE multiplied the 2022 energy prices

by the projection of annual average price changes for each of the nine census divisions

from the Reference case in AEO2023, which has an end year of 2050.

To estimate price

trends after 2050, the 2046–2050 average was used for all years.

Coughlin, K. and B. Beraki. 2018. Residential Electricity Prices: A Review of Data Sources and

Estimation Methods. Lawrence Berkeley National Laboratory. Berkeley, CA. Report No. LBNL-2001169.

Available at ees.lbl.gov/publications/residential-electricity-prices-review (last accessed April 6, 2023).

U.S. Department of Energy–Energy Information Administration. Natural Gas Navigator 2022. Available

at www.eia.gov/naturalgas/data.php (last accessed April 6, 2023).

U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook 2023 with

Projections to 2050. Washington, DC. Available at www.eia.gov/forecasts/aeo/ (last accessed May 7,

2023).

5. Maintenance and Repair Costs

Repair costs are associated with repairing or replacing product components that

have failed in an appliance; maintenance costs are associated with maintaining the

operation of the product. Past rules indicate in general that small, incremental increases

in product efficiency produce no, or only minor, changes in repair and maintenance costs

compared to baseline efficiency products. 76 FR 22454.

For consumer clothes dryers, DOE derived an annualized repair rate based on

Consumer Reports data on repair and maintenance issues for consumer clothes dryers.

DOE estimated that the average repair rate (which measures the repair frequency) for

electric and gas consumer clothes dryers is 12 percent and 14 percent, respectively. The

most likely repairs concern the electromechanical control unit or the electronic control

unit. The repair costs are annualized by dividing by the average equipment lifetime of 14

years.

For this direct final rule, DOE considered comments it had received regarding the

maintenance and repair costs that were submitted in response to the August 2022 NOPR.

Whirlpool stated that DOE’s NOPR analysis failed to adequately account for the

increased repair costs associated with more advanced and expensive electronic parts in

electronic control dryers, which would be mandated through DOE's proposed standards.

Whirlpool commented that a timer replacement on an electromechanical control dryer

will be significantly cheaper than the replacement of an equivalent failed component on

an electronic control dryer, with major component differences being the timer, push-to-

start button, rotary switch, buzzer, appliance control unit, and user interface assembly.

(Whirlpool, No. 53 at pp. 8–9)

As previously stated, for this direct final rule, DOE has updated its methodology

for estimating repair costs and included repair costs associated with timer replacement in

both electromechanical control and electronic control dryers. Based on the information

provided by Whirlpool and a literature review, DOE estimated the repair cost to be $75

for an electromechanical control unit and $225 for an electronic control unit.

6. Product Lifetime

For consumer clothes dryers, DOE developed a distribution of lifetimes from

which specific values were assigned to the appliances in the test sample. DOE analyzed

actual lifetime in the field using a combination of historical shipments data, the stock of

the considered appliances in the American Housing Survey, and responses in a number of

RECS on the age of the appliances in the homes. The data allowed DOE to estimate a

survival function, which provided an average appliance lifetime of approximately 14

years. From the 2015 RECS to the 2020 RECS, there was a 6-percent increase in the

number of consumer clothes dryers retiring before reaching 4 years of age, and an

additional 1 percent lasting beyond 15 years. Therefore, for this direct final rule, DOE’s

estimated average lifetime for consumer clothes dryers remains 14 years, with a

distribution that includes 1 percent more dryers retiring before reaching 4 years and 2

percent more dryers remaining after 15 years and up to 30 years, compared to the NOPR

Weibull lifetime probability distribution. See chapter 8 of the direct final rule TSD for

further details.

7. Discount Rates

In the calculation of LCC, DOE applies discount rates appropriate to households

to estimate the present value of future operating cost savings. DOE estimated a

distribution of discount rates for consumer clothes dryers based on the opportunity cost of

consumer funds.

DOE applies weighted average discount rates calculated from consumer debt and

asset data, rather than marginal or implicit discount rates.

The LCC analysis estimates

net present value over the lifetime of the product, so the appropriate discount rate will

reflect the general opportunity cost of household funds, taking this time scale into

account. Given the long-time horizon modeled in the LCC, the application of a marginal

interest rate associated with an initial source of funds is inaccurate. Regardless of the

method of purchase, consumers are expected to continue to rebalance their debt and asset

holdings over the LCC analysis period, based on the restrictions consumers face in their

debt payment requirements and the relative size of the interest rates available on debts

and assets. DOE estimates the aggregate impact of this rebalancing using the historical

distribution of debts and assets.

To establish residential discount rates for the LCC analysis, DOE identified all

relevant household debt or asset classes in order to approximate a consumer’s opportunity

The implicit discount rate is inferred from a consumer purchase decision between two otherwise identical

goods with different first cost and operating cost. It is the interest rate that equates the increment of first

cost to the difference in net present value of lifetime operating cost, incorporating the influence of several

factors: transaction costs; risk premiums and response to uncertainty; time preferences; interest rates at

which a consumer is able to borrow or lend. The implicit discount rate is not appropriate for the LCC

analysis because it reflects a range of factors that influence consumer purchase decisions, rather than the

opportunity cost of the funds that are used in purchases.

100

cost of funds related to appliance energy cost savings. It estimated the average

percentage shares of the various types of debt and equity by household income group

using data from the Federal Reserve Board’s triennial Survey of Consumer Finances

(“SCF”) starting in 1995 and ending in 2019. Using the SCF and other sources, DOE

developed a distribution of rates for each type of debt and asset by income group to

represent the rates that may apply in the year in which amended standards would take

effect. DOE assigned each sample household a specific discount rate drawn from one of

the distributions. The average rate across all types of household debt and equity and

income groups, weighted by the shares of each type, is 4.3 percent. See chapter 8 of the

direct final rule TSD for further details on the development of consumer discount rates.

8. Energy Efficiency Distribution in the No-New-Standards Case

To accurately estimate the share of consumers that would be affected by a

potential energy conservation standard at a particular efficiency level, DOE’s LCC

analysis considered the projected distribution (market shares) of product efficiencies

under the no-new-standards case (i.e., the case without amended or new energy

conservation standards).

To estimate the energy efficiency distribution of consumer clothes dryers for 2027

or 2028, DOE used 2021 model data from DOE’s CCD and shipments data for consumer

U.S. Board of Governors of the Federal Reserve System. Survey of Consumer Finances. 1995, 1998,

2001, 2004, 2007, 2010, 2013, 2016, and 2019. Available at

www.federalreserve.gov/econresdata/scf/scfindex.htm (last accessed May 2023).

101

clothes dryers from the ENERGY STAR program.

64,

Based on the historical shipments

trend of ENERGY STAR- qualified consumer clothes dryers, DOE estimated an annual

0.47-percent and 0.02-percent increase in shipment-weighted efficiency for electric

standard and vented gas standard clothes dryers, respectively, beginning in 2021. Annual

shipment-weighted efficiency for the other product classes (which in total have less than

2.5-percent market share) is held constant. The estimated market shares for the no-new-

standards case for consumer clothes dryers are shown in Table IV.19 and Table IV.20.

See chapter 8 of the direct final rule TSD for further information on the derivation of the

efficiency distributions.

Table IV.19 No-New-Standards Case Efficiency Distribution in 2027 and 2028:

Electric Standard, Electric Compact (120V), Electric Compact (240V), and Ventless

Electric Compact (240V)

Electric Standard

Electric Compact

(120V)

Vented Electric

Compact (240V)

Ventless Electric

Compact (240V)

CEF

(lb/kWh)

Market

CEF

(lb/kWh)

Market

CEF

(lb/kWh)

Market

CEF

(lb/kWh)

Market

2.20

14%

2.36

20%

2.00

35%

2.03

14%

2.68

13%

3.15

15%

2.44

25%

2.68

59%

3.04

13%

3.35

25%

2.76

30%

6.80

28%

3.27

4.28

3.30

10%

3.93

42%

4.33

3.57

4.21

(7%)*

4.63

3.82 0%

5.20

6.37

40%

3.91

7.39

* The value in the parentheses indicates 2028 market share.

U.S. Department of Energy's Compliance Certification Database. Available at

www.regulations.doe.gov/certification-data/#q=Product_Group_s%3A* (last accessed April 17, 2023).

ENERGY STAR, ENERGY STAR

Unit Shipment and Market Penetration Report Calendar Year 2021

Summary. Available at

www.energystar.gov/partner_resources/products_partner_resources/brand_owner_resources/unit_shipme

nt_data (last accessed April 17, 2023).

102

Table IV.20 No-New-Standards Case Efficiency Distribution in 2027 and 2028:

Vented Gas Standard, and Ventless Electric Combination Washer-Dryer*

Vented Gas Standard

Ventless Electric,

Combination Washer-

Dryer

CEF

(lb/kWh)

Market

CEF

(lb/kWh)

Market

2.00

15%

2.27

39%

2.44

19%

2.33

58%

3.00

18%

4.01

3.48

48%

3.83

*There are no models or shipments data for vented gas compact clothes dryers on the market.

The LCC Monte Carlo simulations draw from the efficiency distributions and

randomly assign an efficiency to the consumer clothes dryers purchased by each sample

household in the no-new-standards case. The resulting percentage shares within the

sample match the market shares in the efficiency distributions.

In the August 2022 NOPR, DOE performed a random assignment of efficiency

levels to consumers in its Monte Carlo sample. While DOE acknowledges that economic

factors may play a role when consumers decide on what type of clothes dryers to install,

assignment of clothes dryer efficiency for a given installation, based solely on economic

measures such as life-cycle cost or simple payback period, most likely would not fully

and accurately reflect actual real-world installations. There are a number of market

failures discussed in the economics literature that illustrate how purchasing decisions

with respect to energy efficiency are unlikely to be perfectly correlated with energy use,

as described below. DOE maintains that the method of assignment, is a reasonable

approach, because it simulates behavior in the clothes dryer market, where market

failures result in purchasing decisions not being perfectly aligned with economic

103

interests, more realistically than relying only on apparent cost-effectiveness criteria

derived from the limited information in RECS. DOE further emphasizes that its approach

does not assume that all purchasers of consumer clothes dryers make economically

irrational decisions (i.e., the lack of a correlation is not the same as a negative

correlation). As part of the random assignment, some homes with more frequent dryer

events will be assigned higher efficiency clothes dryers, and some homes with

particularly lower dryer events will be assigned baseline units. By using this approach,

DOE acknowledges the uncertainty inherent in the data and minimizes any bias in the

analysis by using random assignment, as opposed to assuming certain market conditions

that are unsupported given the available evidence.

The following discussion provides more detail about the various market failures

that affect consumer clothes dryer purchases. First, consumers are motivated by more

than simple financial trade-offs. There are several behavioral factors that can influence

the purchasing decisions of complicated multi-attribute products, such as consumer

clothes dryers. For example, consumers (or decision makers in an organization) are

highly influenced by choice architecture, defined as the framing of the decision, the

surrounding circumstances of the purchase, the alternatives available, and how they are

presented for any given choice scenario.

The same consumer or decision maker may

make different choices depending on the characteristics of the decision context (e.g., the

timing of the purchase, competing demands for funds), which have nothing to do with the

characteristics of the alternatives themselves or their prices. Consumers or decision

Thaler, R.H., Sunstein, C.R., and Balz, J.P. (2014). “Choice Architecture” in The Behavioral

Foundations of Public Policy, Eldar Shafir (ed).

104

makers also face a variety of other behavioral phenomena including loss aversion,

sensitivity to information salience, and other forms of bounded rationality.

Thaler, who

won the Nobel Prize in Economics in 2017 for his contributions to behavioral economics,

and Sunstein point out that these behavioral factors are strongest when the decisions are

complex and infrequent, when feedback on the decision is muted and slow, and when

there is a high degree of information asymmetry.

These characteristics describe almost

all purchasing situations of appliances and equipment, including consumer clothes dryers.

The installation of a new or replacement consumer clothes dryers is done very

infrequently, as evidenced by the mean lifetime of 14 years for consumer clothes dryers.

Further, if the purchaser of the consumer clothes dryer is not the entity paying the energy

costs (e.g., a building owner and tenant), there may be little to no feedback on the

purchase. Additionally, there are systematic market failures that are likely to contribute

further complexity to how products are chosen by consumers, as explained in the

following paragraphs. The first of these market failures—the split-incentive or principal-

agent problem—is likely to significantly affect consumer clothes dryers. The principal-

agent problem is a market failure that results when the consumer that purchases the

equipment does not internalize all of the costs associated with operating the equipment.

Instead, the user of the product, who has no control over the purchase decision, pays the

operating costs. There is a high likelihood of split-incentive problems in the case of rental

Thaler, R.H., and Bernartzi, S. (2004). “Save More Tomorrow: Using Behavioral Economics in Increase

Employee Savings,” Journal of Political Economy 112(1), S164-S187. See also Klemick, H., et al. (2015)

“Heavy-Duty Trucking and the Energy Efficiency Paradox: Evidence from Focus Groups and Interviews,”

Transportation Research Part A: Policy & Practice, 77, 154-166 (providing evidence that loss aversion

and other market failures can affect otherwise profit-maximizing firms).

Thaler, R.H., and Sunstein, C.R. (2008). Nudge: Improving Decisions on Health, Wealth, and Happiness.

New Haven, CT: Yale University Press.

105

properties where the landlord makes the choice of what consumer clothes dryers to

install, whereas the renter is responsible for paying energy bills.

In addition to the split-incentive problem, there are other market failures that are

likely to affect the choice of consumer clothes dryer efficiency made by consumers. For

example, unplanned replacements due to unexpected failure of equipment such as a

consumer clothes dryer are strongly biased toward like-for-like replacement (i.e.,

replacing the non-functioning equipment with a similar or identical product). Time is a

constraining factor during unplanned replacements, and consumers may not consider the

full range of available options on the market, despite their availability. The consideration

of alternative product options is far more likely for planned replacements and

installations in new construction.

Additionally, Davis and Metcalf

conducted an experiment demonstrating that,

even when consumers are presented with energy consumption information, the nature of

the information available to consumers (e.g., from EnergyGuide labels) results in an

inefficient allocation of energy efficiency across households with different usage levels.

Their findings indicate that households are likely to make decisions regarding the

efficiency of the air conditioning equipment of their homes that do not result in the

highest net present value for their specific usage pattern (i.e., their decision is based on

imperfect information and, therefore, is not necessarily optimal). Also, most consumers

Davis, L.W., and G.E. Metcalf (2016): “Does better information lead to better choices? Evidence from

energy-efficiency labels,” Journal of the Association of Environmental and Resource Economists, 3(3),

589-625. Available at: www.journals.uchicago.edu/doi/full/10.1086/686252 (Last accessed August 1,

2023).

106

did not properly understand the labels (specifically whether energy consumption and cost

estimates were national averages or specific to their State). As such, consumers did not

make the most informed decisions. Consumer clothes dryers do not require EnergyGuide

labels, therefore energy consumption information is more difficult to determine for a

consumer, resulting in an even more inefficient allocation of energy efficiency across

households with different usage levels.

In part because of the way information is presented, and in part because of the

way consumers process information, there is also a market failure consisting of a

systematic bias in the perception of equipment energy usage, which can affect consumer

choices. Attari et al.

show that consumers tend to underestimate the energy use of large

energy-intensive appliances (such as air conditioners, dishwashers, and clothes dryers),

but overestimate the energy use of small appliances (such as light bulbs). Therefore, it is

possible that consumers systematically underestimate the energy use associated with

consumer clothes dryers, resulting in less cost-effective purchases.

These market failures affect a sizeable share of the consumer population. A study

by Houde

indicates that there is a significant subset of consumers that appear to

Attari, S.Z., M.L. DeKay, C.I. Davidson, and W. Bruine de Bruin (2010): “Public perceptions of energy

consumption and savings.” Proceedings of the National Academy of Sciences 107(37), 16054-16059.

Available at: www.pnas.org/content/107/37/16054 (Last accessed August 1, 2023).

Houde, S. (2018): “How Consumers Respond to Environmental Certification and the Value of Energy

Information,” The RAND Journal of Economics, 49 (2), 453-477. Available at:

onlinelibrary.wiley.com/doi/full/10.1111/1756-2171.12231 (Last accessed August 1, 2023).

107

purchase appliances without taking into account their energy efficiency and operating

costs at all.

The existence of market failures in the residential sector is well supported by the

economics literature and by a number of case studies. If DOE developed an efficiency

distribution that assigned consumer clothes dryer efficiency in the no-new-standards case

solely according to energy use or economic considerations such as life-cycle cost or

payback period, the resulting distribution of efficiencies within the consumer sample

would not reflect any of the market failures or behavioral factors above. Thus, DOE

concludes such a distribution would not be representative of the consumer clothes dryer

market. Further, even if a specific household is not subject to the market failures above,

the purchasing decision of consumer clothes dryer efficiency can be highly complex and

influenced by a number of factors (e.g., aesthetics) not captured by the building

characteristics available in the RECS sample. These factors can lead to households or

building owners choosing a consumer clothes dryer efficiency that deviates from the

efficiency predicted using only energy use or economic considerations such as life-cycle

cost or payback period (as calculated using the information from RECS 2020).

There is a complex set of behavioral factors, with sometimes opposing effects,

affecting the consumer clothes dryer market. It is impractical to model every consumer

decision incorporating all of these effects at this extreme level of granularity given the

limited available data. Given these myriad factors, DOE estimates the resulting

distribution of such a model, if it were possible, would be very scattered with high

variability. It is for this reason DOE utilizes a random distribution (after accounting for

108

efficiency market share constraints) to approximate these effects. The methodology is not

an assertion of economic irrationality, but instead, it is a methodological approximation

of complex consumer behavior. The analysis is neither biased toward high or low energy

savings. The methodology does not preferentially assign lower-efficiency consumer

clothes dryers to households in the no-new-standards case where savings from the rule

would be greatest, nor does it preferentially assign lower-efficiency consumer clothes

dryers to households in the no-new-standards case where savings from the rule would be

smallest. Some consumers were assigned the clothes dryers that they would have chosen

if they had engaged in perfect economic considerations when purchasing the products.

Others were assigned less-efficient clothes dryers even where a more-efficient product

would eventually result in life-cycle savings, simulating scenarios where, for example,

various market failures prevent consumers from realizing those savings. Still others were

assigned clothes dryers that were more efficient than one would expect simply from life-

cycle costs analysis, reflecting, say, “green” behavior, whereby consumers ascribe

independent value to minimizing harm to the environment.

Therefore, for this direct final rule, DOE performed a random assignment of

efficiencies in the LCC analysis.

Additionally, for this direct final rule, DOE considered comments it received

regarding the projected distribution of product efficiencies under the no-new-standards

case that were submitted in response to the August 2022 NOPR. The CA IOUs requested

that DOE clarify the changes in efficiency distributions from the 2021 preliminary

analysis to the August 2022 NOPR analysis, specifically regarding the percentage of

109

products that meet or exceed the ENERGY STAR level in the no-new-standards case.

The CA IOUs stated that the preliminary analysis efficiency distributions resulted in a

reasonably favorable consumer impact analysis for TSL 4. The CA IOUs recommended

that DOE reconsider the analysis and conclusion regarding TSL 4 if the preliminary

analysis efficiency distributions were more accurate. (CA IOUs, No. 50 at pp. 3–4).

In the 2021 preliminary analysis, DOE utilized a consumer-choice model to

calculate market share of various efficiency options for consumer clothes dryers. This

model considered factors such as the first cost for electric standard, vented gas standard,

ventless electric compact (204V), and ventless electric washer-dryer units. The

consumer-choice model relied on historical sales data from 2005 to 2011. To project the

efficiency distribution for other product classes (electric compact (120V), vented electric

compact (240V), DOE used inputs based on its own test samples and a review of models

available in the market.

In the 2022 NOPR analysis, DOE evaluated concerns expressed by stakeholders

regarding the adequacy and representativeness of the historical sales data from 2005 to

2011. DOE recognized that these data might not accurately reflect the correlations

between shipments and sale prices in recent years. For this reason, as well as to maintain

consistency in its methodology across product classes, DOE elected to use CCD model

110

counts

instead of market shipments data to derive the no-new-standards case efficiency

distributions for the NOPR.

The Joint Commenters commented that the ENERGY STAR shipment data is a

better reflection of the consumer clothes dryer market than CCD model counts. The Joint

Commenters stated that according to the ENERGY STAR shipment data, only about 40

percent of electric standard dryer models meet TSL 3 as opposed to DOE's estimate of 65

percent. (Joint Commenters, No. 51 at pp. 3–4).

For this direct final rule, DOE has considered the ENERGY STAR shipment data

for standard consumer clothes dryers along with other pertinent market information. As a

result, DOE has revised the market share estimate for electric and gas standard consumer

clothes dryers meeting ENERGY STAR criteria in the compliance year. DOE reduced

market share of electric standard consumer clothes dryers that meet TSL 3 from 61

percent to 42 percent and increased market share of gas standard consumer clothes dryers

that meet TSL 3 from 38 percent to 48 percent. For the remaining product classes, which

together account for less than 2.5 percent of the total shipments, DOE has continued to

use the CCD model counts because it is not aware of other available information.

9. Payback Period Analysis

The payback period is the amount of time (expressed in years) it takes the

consumer to recover the additional installed cost of more efficient products, compared to

The CCD database lists basic models of certified consumer clothes dryers that are subject to DOE’s

energy conservation standards, including their rated capacities and CEF. These clothes dryer models are

submitted by manufacturers or their third-party representatives.

111

baseline products, through energy cost savings. Payback periods that exceed the life of

the product mean that the increased total installed cost is not recovered in reduced

operating expenses.

The inputs to the PBP calculation for each efficiency level are the change in total

installed cost of the product and the change in the first-year annual operating

expenditures relative to the baseline. DOE refers to this as a “simple PBP” because it

does not consider changes over time in operating cost savings. The PBP calculation uses

the same inputs as the LCC analysis when deriving first-year operating costs.

As noted previously, EPCA establishes a rebuttable presumption that a standard is

economically justified if the Secretary finds that the additional cost to the consumer of

purchasing a product complying with an energy conservation standard level will be less

than three times the value of the first year’s energy savings resulting from the standard, as

calculated under the applicable test procedure. (42 U.S.C. 6295(o)(2)(B)(iii)) For each

considered efficiency level, DOE determined the value of the first year’s energy savings

by calculating the energy savings in accordance with the applicable DOE test procedure

and multiplying those savings by the average energy price projection for the year in

which compliance with the amended standards would be required.

G. Shipments Analysis

DOE uses projections of annual product shipments to calculate the national

impacts of potential amended or new energy conservation standards on energy use, NPV,

112

and future manufacturer cash flows.

The shipments model takes an accounting

approach, tracking market shares of each product class and the vintage of units in the

stock. Stock accounting uses product shipments as inputs to estimate the age distribution

of in-service product stocks for all years. The age distribution of in-service product

stocks is a key input to calculations of both the NES and NPV, because operating costs

for any year depend on the age distribution of the stock.

Total product shipments for consumer clothes dryers are developed by

considering the demand from replacements for units in stock that fail and the demand

from new installations in newly constructed homes. DOE calculated shipments due to

replacements using the retirement function developed for the LCC analysis. DOE

calculated shipments due to new installations using estimates for consumer clothes dryer

saturation rates in newly constructed homes from 2015 to 2020 in the 2020 RECS and

projections of new housing starts in AEO2023.

DOE disaggregated total product shipments into each product class using

estimated market shares of each product class. To estimate these market shares, DOE first

developed a linear time series regression model to estimate market share between the

product fuel type (i.e., gas or electric) by fitting the historical shipments of gas consumer

clothes dryers. Historical shipments data showed a steady decline of market share of gas

consumer clothes dryers, from 23 percent in 2000 to 17 percent in 2022. The linear

DOE uses data on manufacturer shipments as a proxy for national sales, as aggregate data on sales are

lacking. In general, one would expect a close correspondence between shipments and sales.

113

regression model indicates that market share of gas consumer clothes dryers is strongly

correlated with its historical time series.

After developing the market share estimation between electric and gas consumer

clothes dryers, DOE then subtracted the estimated gas clothes dryer market share from

total shipments and divided the electric clothes dryer market share into each electric

consumer clothes dryer product class. DOE estimated that electric standard and vented

gas standard consumer clothes dryers account for approximately 84 percent and 14

percent of the total shipments during the analysis period, respectively.

To estimate shipments under a standards case, DOE considers the impacts on

shipments from changes in product purchase price and operating cost associated with

higher energy efficiency levels using a price elasticity and an efficiency elasticity. As in

the April 2021 preliminary analysis, DOE employed an efficiency elasticity rate of 0.2

percent and a price elasticity rate of -0.45 percent in its shipments model. These values

are based on analysis of aggregated data for five residential appliances: consumer clothes

washers, dishwashers, refrigerators, freezers, and room air conditioners.

The market

impact is defined as the difference between the product of price elasticity of demand and

the change in price due to a standard level, and the product of the efficiency elasticity and

the change in operating costs due to a standard level.

Fujita, K. (2015) Estimating Price Elasticity using Market-Level Appliance Data. Lawrence Berkeley

National Laboratory, LBNL-188289.

114

DOE assumed when market impact occurs (i.e., when shipments drop under a

standards case), the affected consumers would either repair their product or purchase a

used clothes dryer rather than a new one. In the repair scenario, the model assumes that

the product’s life is extended by approximately 5 years. In the used product scenario, the

model assumes the remaining average lifetime for a used clothes dryer is 7 years.

Therefore, this market impact effectively influences the decision between repairing or

replacing the product, as well as the decision between purchasing a used dryer or a new

one. See chapter 9 of the direct final rule TSD for details.

For this direct final rule, DOE considered comments it received regarding the

shipments analysis that were submitted in response to the August 2022 NOPR. Whirlpool

commented that consumers may continue replacing cheaper components well into the life

of an electromechanical controlled dryer, extending its life, while they may not decide to

make a more expensive electronic component repair, like a user interface assembly, after

several years of ownership of an electronic control dryer. Whirlpool stated that DOE's

proposed standards may effectively shorten the useful life of a consumer clothes dryer

because of this repair-versus-replacement calculus, resulting in loss of time-saving

benefits of dryer ownership. (Whirlpool, No. 53 at pp. 8–9)

As stated in section IV.C.1 of this document, the recommended standards would

continue to allow for electromechanical controlled clothes dryers to be sold on the

market. In addition, DOE is not aware of reliability issues associated with the

implementation of electronic controls relative to electromechanical controls. Whirlpool’s

assertion that the adopted standards may shorten the useful life of consumer clothes

115

dryers lacks quantitative data to support it. As stated in section IV.F.6 of this document,

DOE’s lifetime estimation is calibrated using shipments data, which include the adopted

efficiency levels of ENERGY STAR-qualified consumer clothes dryers sold in the

market. DOE’s updated Weibull lifetime distribution in this direct final rule captures the

trend of shorter lifetime and delayed replacement of consumer clothes dryers based on

the recent field data. See chapter 9 of the direct final rule TSD for details.

H. National Impact Analysis

The NIA assesses the NES and the NPV from a national perspective of total

consumer costs and savings that would be expected to result from new or amended

standards at specific efficiency levels.

(“Consumer” in this context refers to consumers

of the product being regulated.) DOE calculates the NES and NPV for the potential

standard levels considered based on projections of annual product shipments, along with

the annual energy consumption and total installed cost data from the energy use and LCC

analyses. For the present analysis, DOE projected the energy savings, operating cost

savings, product costs, and NPV of consumer benefits over the lifetime of consumer

clothes dryers sold from 2027 through 2056 for all TSLs other than 2028 through 2057

for TSL 3 (the Recommended TSL detailed in the Joint Agreement).

DOE evaluates the impacts of new or amended standards by comparing a case

without such standards with standards-case projections. The no-new-standards case

characterizes energy use and consumer costs for each product class in the absence of new

The NIA accounts for impacts in the 50 states and U.S. territories.

116

or amended energy conservation standards. For this projection, DOE considers historical

trends in efficiency and various forces that are likely to affect the mix of efficiencies over

time. DOE compares the no-new-standards case with projections characterizing the

market for each product class if DOE adopted new or amended standards at specific

energy efficiency levels (i.e., the TSLs or standards cases) for that class. For the

standards cases, DOE considers how a given standard would likely affect the market

shares of products with efficiencies greater than the standard.

DOE uses a spreadsheet model to calculate the energy savings and the national

consumer costs and savings from each TSL. Interested parties can review DOE’s

analyses by changing various input quantities within the spreadsheet. The NIA

spreadsheet model uses typical values (as opposed to probability distributions) as inputs.

Table IV.21 summarizes the inputs and methods DOE used for the NIA analysis

for the direct final rule. Discussion of these inputs and methods follows the table. See

chapter 10 of the direct final rule TSD for further details.

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Table IV.21 Summary of Inputs and Methods for the National Impact Analysis

Inputs

Methods

Shipments

Annual shipments from shipments model.

Compliance Date of Standard

TSL 1, TSL 2, TSL 4, TSL 5, and TSL 6: 2027

TSL 3 (the Recommended TSL): 2028

Efficiency Trends

No-new-standards case: Annual efficiency improvement of

0.47% for electric standard and 0.02% for vented gas standard

consumer clothes dryers.

Standards cases: “Roll-up” equipment to meet potential

efficiency level.

Annual Energy Consumption per Unit

Annual weighted average values are a function of energy use at

each TSL.

Total Installed Cost per Unit

Annual weighted average values are a function of cost at each

TSL.

Incorporates projection of future product prices based on

historical data.

Annual Energy Cost per Unit

Annual weighted average values as a function of the annual

energy consumption per-unit and energy prices.

Repair and Maintenance Cost per Unit

Annual values change between electromechanical controls and

electronic controls efficiency level.

Energy Price Trends

AEO2023 projections (to 2050) and constant value based on the

average between 2046 and 2050 thereafter.

Energy Site-to-Primary and FFC

Conversion

A time-series conversion factor based on AEO2023.

Discount Rate

3% and 7%

Present Year

2024

1. Product Efficiency Trends

A key component of the NIA is the trend in energy efficiency projected for the

no-new-standards case and each of the standards cases. Section IV.F.8 of this document

describes how DOE developed an energy efficiency distribution for the no-new-standards

case (which yields a shipment-weighted average efficiency) for each of the considered

product classes for the year of anticipated compliance with an amended or new standard.

To project the trend in efficiency absent amended standards for consumer clothes dryers

over the entire shipments projection period, DOE used an annual 0.47-percent and 0.02-

percent increase in shipment-weighted efficiency beginning in 2021 for electric standard

and vented gas standard consumer clothes dryers, respectively. The efficiency for the

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other product classes remains at their 2021 shipments-weighted efficiency levels. The

approach is further described in chapter 10 of the direct final rule TSD.

For the standards cases, DOE used a “roll-up” scenario to establish the shipment-

weighted efficiency for the year that standards are assumed to become effective. In this

scenario, the market shares of products in the no-new-standards case that do not meet the

standard under consideration would “roll-up” to meet the new standard level, and the

market share of products above the standard would remain unchanged.

2. National Energy Savings

The national energy savings analysis involves a comparison of national energy

consumption of the considered products between each potential standards case (TSL) and

the case with no-new or amended energy conservation standards. DOE calculated the

national energy consumption by multiplying the number of units (stock) of each product

(by vintage or age) by the unit energy consumption (also by vintage). DOE calculated

annual NES based on the difference in national energy consumption for the no-new-

standards case and for each higher efficiency standard case. DOE estimated energy

consumption and savings based on-site energy and converted the electricity consumption

and savings to primary energy (i.e., the energy consumed by power plants to generate site

electricity) using annual conversion factors derived from AEO2023. Cumulative energy

savings are the sum of the NES for each year over the timeframe of the analysis.

Use of higher efficiency products is sometimes associated with a direct rebound

effect, which refers to an increase in utilization of the product due to the increase in

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efficiency. DOE did not find any data on the rebound effect specific to consumer clothes

dryers, so it did not include a rebound effect in the analysis.

Separate from a direct rebound effect, DOE also assessed the potential

implications of amended standards as it relates to clothes dryer energy use, namely

whether amended standards could result in a decrease in drying performance that would

require consumers to re-run their drying cycles to achieve satisfactory drying

performance. As discussed in section II.B.2 of this document, DOE’s appendix D2 test

procedure includes a maximum FMC threshold (i.e., a dryness level threshold that much

be achieved in order to be considered a valid test cycle), which ensures that the rated

energy consumption of clothes dryers is representative of consumer expectations for

dryness. DOE testing confirmed that commercially available products achieve this FMC

dryness threshold at each of the efficiency levels considered in this direct final rule

analysis. Consequently, DOE has determined that clothes dryers that comply with the

amended standards will provide consumer-acceptable levels of dryness corresponding to

the rated energy consumption as measured by appendix D2. In the NES, therefore, DOE

assumed that the amended standards would not result in any increase in clothes dryer

usage, such as that arising from consumers re-running drying cycles.

In 2011, in response to the recommendations of a committee on “Point-of-Use

and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency Standards”

appointed by the National Academy of Sciences, DOE announced its intention to use

FFC measures of energy use and greenhouse gas and other emissions in the national

impact analyses and emissions analyses included in future energy conservation standards

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rulemakings. 76 FR 51281 (Aug. 18, 2011). After evaluating the approaches discussed

in the August 18, 2011, notice, DOE published a statement of amended policy in which

DOE explained its determination that EIA’s National Energy Modeling System

(“NEMS”) is the most appropriate tool for its FFC analysis and its intention to use NEMS

for that purpose. 77 FR 49701 (Aug. 17, 2012). NEMS is a public domain, multi-sector,

partial equilibrium model of the U.S. energy sector

that EIA uses to prepare its Annual

Energy Outlook. The FFC factors incorporate losses in production and delivery in the

case of natural gas (including fugitive emissions) and additional energy used to produce

and deliver the various fuels used by power plants. The approach used for deriving FFC

measures of energy use and emissions is described in appendix 10B of the direct final

rule TSD.

For this direct final rule, DOE considered comments it had received regarding the

methodology for calculating the national energy savings that was presented in the August

2022 NOPR. The approach used for this direct final rule is largely the same approach

DOE had used for the August 2022 NOPR analysis.

In response to the August 2022 NOPR, EEI stated that in the past, DOE stated

potentially using a captured-energy approach when estimating upstream full-fuel-cycle

energy savings; however, EEI noted that in recent notices and rulemakings, DOE is now

For more information on NEMS, refer to The National Energy Modeling System: An Overview 2009,

DOE/EIA-0581(2009), October 2009. Available at www.eia.gov/forecasts/aeo/index.cfm (last accessed

April 20, 2023).

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overstating these estimates by using a fossil fuel equivalent for renewable energy,

significantly overstating the upstream savings. (EEI, No. 37 at pp. 45–46)

As previously mentioned, DOE converts electricity consumption and savings to

primary energy and FFC energy using annual conversion factors derived from the AEO.

Traditionally, EIA has used the fossil fuel equivalency approach to report

noncombustible renewables’ contribution to total primary energy. The fossil fuel

equivalency approach applies an annualized weighted average heat rate for fossil fuel

power plants to the electricity generated (in kWh) from noncombustible renewables. EIA

recognizes that using captured energy (i.e., the net energy available for direct

consumption after transformation of a noncombustible renewable energy into electricity)

and using incident energy (i.e., the mechanical, radiation, or thermal energy that is

measurable as the “input” to the device) are possible approaches for converting

renewable electricity to a common measure of primary energy, but it continues to use the

fossil fuel equivalency approach in the AEO and other reporting of energy statistics.

DOE has used this approach to accounting for primary energy savings from energy

efficiency standards for the entirety of the appliance standards program.

Whirlpool commented that the lessening of utility and performance of dryers,

including increases to drying cycle times and potentially increased fabric damage to

clothes, may lead to corresponding compensatory behavioral changes from consumers

that may result in lost energy savings. Whirlpool recommended that DOE’s analysis

account for possible negative rebound effects of changes, such that the expected energy

savings from an amended standard may not be fully delivered over the analyzed period.

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Whirlpool commented that consumers associate longer drying times with more potential

damage to their clothes and may choose cycles or options that reduce overall drying time

at the expense of energy consumption. (Whirlpool, No. 53 at p. 6)

DOE has examined the potential impacts on different attributes of product

performance while considering amended standards, as detailed in section IV.C.1 of this

document. As discussed further in section V.B.4 of this document, DOE data indicate

that the standards adopted by this direct final rule will not necessitate any substantive

increase in cycle times compared to typical cycle times currently associated with baseline

consumer clothes dryers and therefore are not expected to have any negative impacts on

fabric care and product wear and tear that would lead consumers to use more energy

consumptive drying cycles. Moreover, DOE notes that the appendix D2 test procedure,

which will be required to demonstrate compliance with the amended standards

established in this direct final rule, and is currently required for ENERGY STAR

certification, ensures that clothes dryers provide a consumer-acceptable level of dryness.

Furthermore, as previously discussed, on February 14, 2024, DOE received a

second joint statement from the same group of stakeholders that submitted the Joint

Agreement (including AHAM, of which Whirlpool is a member) in which the signatories

reaffirmed the standards recommended in the Joint Agreement.

In particular, the letter

states that the stakeholders do not anticipate the recommended standards will negatively

affect features or performance, including cycle time. In particular, the signatories stated

This document is available in the docket at: www.regulations.gov/comment/EERE-2014-BT-STD-0058-

0058.

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that because the test procedure that will be used to determine compliance with amended

standards (i.e., appendix D2) requires that dryers meet a threshold for “final moisture

content” in order to be certified as compliant, this final moisture content requirement

ensures that compliant clothes dryers will adequately dry clothes. The signatories further

noted that there are more than 400 electric clothes dryer models and nearly 200 gas

clothes dryer models that are certified to the current ENERGY STAR specification,

which is equivalent to the recommended standard levels and is based on appendix D2,

and that these models all meet the final moisture content threshold specified in appendix

D2. For further discussion of consumer clothes dryer performance as it relates to

amended standards, see section V.B.4 of this document.

DOE acknowledges that this conclusion is contrary to its assumptions in the final

rule that it published on December 16, 2020 (“December 2020 Final Rule”). 85 FR

81359. There, DOE assumed that consumers might need to re-run their clothes washers

or dryers through multiple cycles “to adequately clean or dry their clothing.” 85 FR

81365. In this rulemaking, DOE has found no evidence suggesting that consumers are

running their dryers multiple times at TSL 3 (i.e., the Recommended TSL), which

corresponds to the current ENERGY STAR efficiency level for both electric and gas

standard clothes dryers. As supported by data described in section IV.E of this document,

average consumer usage of electric standard clothes has steadily declined from 301

cycles per year per dryer in the 2005 RECS to 213 cycles per year per dryer in the 2020

RECS, and vented gas standard clothes dryer usage has declined from 292 cycles in the

2005 RECS to 213 cycles in the 2020 RECS, while the average household size has

remained essentially unchanged (average 3 household members) during the same period.

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This shows a significant downward trend in the average number of cycles run on each

consumer clothes dryer over the past 15 years, even after the implementation of the

current amended standard in 2015. These data indicate that amended energy conservation

standards have not resulted in consumers increasing dryer usage due to amended

standards for consumer clothes dryers.

Given that there is no evidence of any previous consumer clothes dryer standard

increasing drying cycles per year, and in fact, instead cycles per year have decreased over

time through multiple standards, DOE determines that a standard at the Recommended

TSL would not be expected to lead consumers to increase their use of consumer clothes

dryers.

3. Net Present Value Analysis

The inputs for determining the NPV of the total costs and benefits experienced by

consumers are (1) total annual installed cost, (2) total annual operating costs (energy

costs and repair and maintenance costs), and (3) a discount factor to calculate the present

value of costs and savings. DOE calculates net savings each year as the difference

between the no-new-standards case and each standards case in terms of total savings in

operating costs versus total increases in installed costs. DOE calculates operating cost

savings over the lifetime of each product shipped during the projection period.

As discussed in section IV.F.1 of this document, DOE developed consumer

clothes dryer price trends based on historical PPI data. DOE applied the same trends to

project prices for each product class at each considered efficiency level. By 2057, which

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is the end date of the projection period for the Recommended TSL detailed in Joint

Agreement, the average consumer clothes dryer (real) price is projected to drop 18

percent relative to 2022. DOE’s projection of product prices is described in appendix

10C of the direct final rule TSD.

To evaluate the effect of uncertainty regarding the price trend estimates, DOE

investigated the impact of different product price projections on the consumer NPV for

the considered TSLs for consumer clothes dryers. In addition to the default price trend,

DOE considered two product price sensitivity cases: (1) a high-price-decline case based

on the combined price index from 1980 to 2022

and (2) a constant price trend at the

2022 value. The derivation of these price trends and the results of these sensitivity cases

are described in appendix 10C of the direct final rule TSD.

The energy cost savings are calculated using the estimated energy savings in each

year and the projected price of the appropriate form of energy. To estimate energy prices

in future years, DOE multiplied the average national energy prices by the projection of

annual national-average residential energy price changes in the Reference case from

AEO2023, which has an end year of 2050. To estimate price trends after 2050, the 2046–

2050 average was used for all years. As part of the NIA, DOE also analyzed scenarios

that used inputs from variants of the AEO2023 Reference case that have lower and higher

economic growth. Those cases have lower and higher energy price trends compared to

DOE combined PPI data of “household laundry equipment” from 1948 to 2016 and PPI data of “major

household appliance: primary products” from 2016 to 2022 into one time-series price index to project

future price for consumer clothes dryers.

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the Reference case. NIA results based on these cases are presented in appendix 10D of

the direct final rule TSD.

In calculating the NPV, DOE multiplies the net savings in future years by a

discount factor to determine their present value. For this direct final rule, DOE estimated

the NPV of consumer benefits using both a 3-percent and a 7-percent real discount rate.

DOE uses these discount rates in accordance with guidance provided by the OMB to

Federal agencies on the development of regulatory analysis.

The discount rates for the

determination of NPV are in contrast to the discount rates used in the LCC analysis,

which are designed to reflect a consumer’s perspective. The 7-percent real value is an

estimate of the average before-tax rate of return to private capital in the U.S. economy.

The 3-percent real value represents the “social rate of time preference,” which is the rate

at which society discounts future consumption flows to their present value.

I. Consumer Subgroup Analysis

In analyzing the potential impact of new or amended energy conservation

standards on consumers, DOE evaluates the impact on identifiable subgroups of

consumers that may be disproportionately affected by a new or amended national

standard. The purpose of a subgroup analysis is to determine the extent of any such

disproportional impacts. DOE evaluates impacts on particular subgroups of consumers

by analyzing the LCC impacts and PBP for those particular consumers from alternative

U.S. Office of Management and Budget. Circular A-4: Regulatory Analysis. Available at

www.whitehouse.gov/omb/information-for-agencies/circulars/ (last accessed April 20, 2023). DOE used

the prior version of Circular A-4 (2003) as a result of the effective date of the new version.

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standard levels. For this direct final rule, DOE analyzed the impacts of the considered

standard levels on two subgroups: (1) low-income households and (2) senior-only

households. The analysis used subsets of the 2020 RECS sample composed of

households that meet the criteria for the considered subgroups. DOE used the LCC and

PBP spreadsheet model to estimate the impacts of the considered efficiency levels on

these subgroups. Chapter 11 in the direct final rule TSD describes the consumer

subgroup analysis.

For this direct final rule, DOE considered comments it received regarding the

consumer subgroup analysis that were submitted in response to the August 2022 NOPR.

DOE notes that although several of the comments discussed below are from AHAM, as

previously discussed, on February 14, 2024, DOE received a second joint statement from

the same group of stakeholders that submitted the Joint Agreement (including AHAM) in

which the signatories reaffirmed the standards recommended in the Joint Agreement.

particular, the letter states that “the recommended standards represent the maximum

levels of efficiency that are technologically feasible and economically justified.”

(emphasis added).

In response to the August 2022 NOPR, AHAM stated that in a recent consumer

study conducted by Bellomy Research for AHAM, low-income households were at a

disadvantage when purchasing or replacing a laundry appliance, with many households

indicating that they would have to make financial sacrifices in other areas of their lives to

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accommodate purchasing a dryer. AHAM stated that over 90 percent of low-income

households cited cost as the most important factor when deciding to purchase a dryer, and

nearly 75 percent of low-income households indicated they would not be willing to pay

around $100 more for a more efficient appliance at the time of purchase to save

approximately $50–$150 in energy costs over the lifetime of that appliance. AHAM

stated that one in four low-income households indicated they would delay a replacement

purchase if their laundry appliance stopped working, and in cases of replacement, they

would replace it with another entry-level/value-tier model. Additionally, AHAM stated

that over half of low-income households indicated they would turn to purchasing a used

dryer or apply for assistance. (AHAM, No. 46 at pp. 6–7). AHAM stated that standards

that result in increased prices for entry-level appliances or that price some consumers out

of the clothes dryer market by eliminating technology options that allow manufacturers to

produce entry-level models (e.g., electromechanical controls) deepen inequity for

underserved communities. According to AHAM, if low-income consumers do not have

equitable access, they may forego dryer ownership and use a laundromat with lost time

savings and additional operating costs, rely on expensive financing options, or buy an

older and possibly less efficient used dryer, thus reducing overall savings potential.

(AHAM, No. 46 at pp. 5–6, 8)

AGA and APGA supported AHAM's comments on the disproportionate effect

more stringent standards could have on low-income consumers. (AGA et al., No. 47 at p.

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Whirlpool stated that low-income consumers may not be able to purchase more

efficient dryers due to the significant cost increase and their inability to pay for very large

emergency purchases over $500. Whirlpool stated that while there may be some level of

life-cycle cost savings from proposed standards, consumers who can no longer afford an

entry-level dryer may never realize these savings. Whirlpool stated that purchase price

increases driven by DOE's proposed standards may drive undesirable consumer behavior,

including repairing the old dryer or purchasing a used dryer, effectively keeping older

and less efficient appliances on the grid. Whirlpool requested that DOE ensure new

appliances remain as affordable to low-income consumers as possible. (Whirlpool, No.

53 at pp. 7–8)

NYSERDA stated that amended standards would significantly improve energy

outcomes for low-income households and not create additional burdens. NYSERDA

stated that in New York, there is a relatively even split between owner-occupied and

rented homes, with a significant number of rental properties, especially in new

construction, having in-unit consumer clothes dryers. NYSERDA commented that for

individual renters who are not responsible for the purchase of their clothes dryer but who

are responsible for paying their utility bills, amended standards will provide utility bill

savings without incurring direct equipment costs. (NYSERDA, No. 48 at p. 2)

According to the 2020 RECS clothes dryer sample, approximately 47 percent of

low-income households who have a dryer are renters. In most cases, the property owner

would purchase a new dryer. While the owner might seek to collect some of this cost in

rent, the ability to do so is constrained by lease agreements and larger market forces that

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influence rent levels in particular locations. Thus, it is reasonable to conclude that renters

would see a significant net benefit from a higher efficiency dryer, and this is seen in the

results of DOE’s analysis (see section V.B.1.b of this document for results of the

consumer subgroup analysis). Additionally, for this direct final rule, DOE implemented a

scenario assuming that landlords would pass some of the incremental clothes dryer costs

to renters in the LCC analysis. The results indicate that this scenario would not impact

DOE’s decision on adopting the amended standards. For details of the sensitivity results,

see appendix 11A of the direct final rule TSD.

In DOE’s analysis, approximately 53 percent of low-income households who

have a dryer are homeowners, who would be responsible for purchasing a new dryer.

Given that the average incremental increase in price for a dryer meeting the adopted

standards (relative to the baseline model that reflects current entry-level products) is $27,

DOE believes it is reasonable to conclude that most low-income homeowners who could

afford to purchase a new dryer under the current standard could also afford to purchase a

dryer that meets the new standard, particularly in the absence of data indicating

otherwise. Furthermore, DOE’s analysis found that for the largest product class (i.e.,

electric standard), less than 1 percent of low-income households would experience a net

cost under the adopted standard, but the majority would see a net benefit (see section

V.B.1.b of this document for results of the consumer subgroup analysis).

In total, DOE’s analysis estimated that 45 percent of low-income households who

have a dryer would experience a net benefit and 54 percent of low-income households

who have a dryer would have no impact under the adopted standard.

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AHAM comment in response to the August 2022 NOPR that low-income

consumers might lose equitable access to on-site dryer usage because of the amended

standards did not include supporting data so DOE was unable to fully evaluate the

assertion. Nevertheless, DOE’s shipments analysis takes into account the market impact

under a standards case. For this direct final rule, DOE has implemented scenarios in

which affected consumers would either repair their clothes dryers or opt to purchase a

used one instead of a new clothes dryer (see section IV.G of this document).

AHAM recommended that DOE review all available data sources regarding low-

income households and appliances to incorporate into its low-income analysis, in

particular the basis of only differential discount rates. AHAM commented that DOE’s

analysis is a very myopic view of the effects of standards on low-income households, and

within this framework the approach of using average discount rates is fundamentally

flawed in its understanding of the relationship between disposable income and balance

sheet rebalancing. (AHAM, No. 46 at p. 8)

DOE’s approach to the low-income consumer subgroup analysis includes

households that do not have assets or debts included in the SCF. It is likely that a

majority of these “unbanked” households primarily rely on cash to complete transactions

and as a form of savings, which is included in the distribution of discount rates associated

with low-income consumers. Consumers that rely entirely on cash are assigned a discount

rate of 0 percent, as there is no lost opportunity cost from alternative noncash assets or

debts. For households that utilize nontraditional, nonbank financing, DOE’s methodology

includes a distribution of high discount rates (i.e., >10% percent), which are

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representative of the opportunity cost associated with nonbank lines of credit. Therefore,

DOE determined that this comprehensive approach enables a fair assessment of discount

rates for low-income consumers who have different financial situations.

J. Manufacturer Impact Analysis

1. Overview

DOE performed an MIA to estimate the financial impacts of amended energy

conservation standards on manufacturers of consumer clothes dryers and to estimate the

potential impacts of such standards on direct employment and manufacturing capacity.

The MIA has both quantitative and qualitative aspects and includes analyses of projected

industry cash flows, the INPV, investments in research and development (“R&D”) and

manufacturing capital, and domestic manufacturing employment. Additionally, the MIA

seeks to determine how amended energy conservation standards might affect

manufacturing employment, capacity, and competition, as well as how standards

contribute to overall regulatory burden. Finally, the MIA serves to identify any

disproportionate impacts on manufacturer subgroups, including small business

manufacturers.

The quantitative part of the MIA primarily relies on the GRIM, an industry cash

flow model with inputs specific to this rulemaking. The key GRIM inputs include data

on the industry cost structure, unit production costs, product shipments, manufacturer

markups, and investments in R&D and manufacturing capital required to produce

compliant products. The key GRIM outputs are the INPV, which is the sum of industry

annual cash flows over the analysis period, discounted using the industry-weighted

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average cost of capital, and the impact on domestic manufacturing employment. The

model uses standard accounting principles to estimate the impacts of more stringent

energy conservation standards on a given industry by comparing changes in INPV and

domestic manufacturing employment between a no-new-standards case and the various

standards cases. To capture the uncertainty relating to manufacturer pricing strategies

following amended standards, the GRIM estimates a range of possible impacts under

different markup scenarios.

The qualitative part of the MIA addresses manufacturer characteristics and market

trends. Specifically, the MIA considers such factors as a potential standard’s impact on

manufacturing capacity, competition within the industry, the cumulative impact of other

DOE and non-DOE regulations, and impacts on manufacturer subgroups. The complete

MIA is outlined in chapter 12 of the direct final rule TSD.

DOE conducted the MIA for this rulemaking in three phases. In Phase 1 of the

MIA, DOE prepared a profile of the consumer clothes dryer manufacturing industry

based on the market and technology assessment, preliminary manufacturer interviews,

and publicly available information. This included a top-down analysis of consumer

clothes dryer manufacturers that DOE used to derive preliminary financial inputs for the

GRIM (e.g., revenues; materials, labor, overhead, and depreciation expenses; selling,

general, and administrative expenses (“SG&A”); and R&D expenses). DOE also used

public sources of information to further calibrate its initial characterization of the

consumer clothes dryer manufacturing industry, including company filings of form 10-K

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from the SEC,

corporate annual reports, the U.S. Census Bureau’s Quarterly Survey of

Plant Capacity Utilization,

the U.S. Census Bureau’s Annual Survey of Manufactures

(“ASM”),

and reports from Dun & Bradstreet.

In Phase 2 of the MIA, DOE prepared a framework industry cash-flow analysis to

quantify the potential impacts of amended energy conservation standards. The GRIM

uses several factors to determine a series of annual cash flows starting with the

announcement of the standard and extending over a 30-year period following the

compliance date of the standard. These factors include annual expected revenues, costs

of sales, SG&A and R&D expenses, taxes, and capital expenditures. In general, energy

conservation standards can affect manufacturer cash flow in three distinct ways:

(1) creating a need for increased investment, (2) raising production costs per-unit, and (3)

altering revenue due to higher per-unit prices and changes in sales volumes.

In addition, during Phase 2, DOE developed interview guides to distribute to

manufacturers of consumer clothes dryers in order to develop other key GRIM inputs,

including product and capital conversion costs, and to gather additional information on

the anticipated effects of energy conservation standards on revenues, direct employment,

capital assets, industry competitiveness, and subgroup impacts.

U.S. Securities and Exchange Commission. Company Filings. Available at

www.sec.gov/edgar/searchedgar/companysearch.html. (Last accessed June 6, 2023).

U.S. Census Bureau. Quarterly Survey of Plant Capacity Utilization. Available at

www.census.gov/programs-surveys/qpc/data/tables.html (last accessed June 1, 2023).

U.S. Census Bureau, Annual Survey of Manufactures. Available at www.census.gov/programs-

surveys/asm/data/tables.html (last accessed June 1, 2023).

The Dun & Bradstreet subscription login is available at app.dnbhoovers.com (last accessed June 8,

2023).

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In Phase 3 of the MIA, DOE conducted structured, detailed interviews with

representative manufacturers. During these interviews, DOE discussed engineering,

manufacturing, procurement, and financial topics to validate assumptions used in the

GRIM and to identify key issues or concerns. As part of Phase 3, DOE also evaluated

subgroups of manufacturers that may be disproportionately impacted by amended

standards or that may not be accurately represented by the average cost assumptions used

to develop the industry cash flow analysis. Such manufacturer subgroups may include

small business manufacturers, low-volume manufacturers, niche players, and/or

manufacturers exhibiting a cost structure that largely differs from the industry average.

DOE identified one subgroup for a separate impact analysis: small business

manufacturers. The small business subgroup is discussed in chapter 12 of the direct final

rule TSD.

2. Government Regulatory Impact Model and Key Inputs

DOE uses the GRIM to quantify the changes in cash flow due to amended

standards that result in a higher or lower industry value. The GRIM uses a standard,

annual discounted cash-flow analysis that incorporates manufacturer costs, manufacturer

markups, shipments, and industry financial information as inputs. The GRIM models

changes in costs, distribution of shipments, investments, and manufacturer margins that

could result from an amended energy conservation standard. The GRIM spreadsheet uses

the inputs to arrive at a series of annual cash flows, beginning in 2024 (the base year of

the analysis) and continuing 30 years from the analyzed compliance year.

DOE

For the no-new-standards case and all TSLs except the Recommended TSL (i.e., TSL 3), the analysis

period ranges from 2024-2056. For the Recommended TSL, the analysis period ranges from 2024–2057.

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calculated INPVs by summing the stream of annual discounted cash flows during this

period. For manufacturers of consumer clothes dryers, DOE used a real discount rate of

7.5 percent, which was derived from industry financials and then modified according to

feedback received during manufacturer interviews.

The GRIM calculates cash flows using standard accounting principles and

compares changes in INPV between the no-new-standards case and each standards case.

The difference in INPV between the no-new-standards case and a standards case

represents the financial impact of the amended energy conservation standard on

manufacturers. As discussed previously, DOE developed the critical GRIM inputs using

a number of sources, including publicly available data, results of the engineering analysis

and shipments analysis, and information gathered from industry stakeholders during the

course of manufacturer interviews. The GRIM results are presented in section V.B.2 of

this document. Additional details about the GRIM, the discount rate, and other financial

parameters can be found in chapter 12 of the direct final rule TSD.

a. Manufacturer Production Costs

Manufacturing more efficient products is typically more expensive than

manufacturing baseline products due to the use of more complex components, which are

typically more costly than baseline components. The changes in MPCs of covered

products can affect the revenues, gross margins, and cash flow of the industry. DOE

models the relationship between efficiency and MPCs as a part of its engineering

analysis. For a complete description of the MPCs, see section IV.C of this document and

chapter 5 of the direct final rule TSD.

137

b. Shipments Projections

The GRIM estimates manufacturer revenues based on total unit shipment

projections and the distribution of those shipments by efficiency level. Changes in sales

volumes and efficiency mix over time can significantly affect manufacturer finances. For

this analysis, the GRIM uses the NIA’s annual shipment projections derived from the

shipments analysis from the base year (2024) to the end year of the analysis period (30

years from the analyzed compliance date

). See section IV.G of this document and

chapter 9 of the direct final rule TSD for additional details.

c. Capital and Product Conversion Costs

Amended energy conservation standards could cause manufacturers to incur

conversion costs to bring their production facilities and product designs into compliance.

DOE evaluated the level of conversion-related expenditures that would be needed to

comply with each considered efficiency level in each product class. For the MIA, DOE

classified these conversion costs into two major groups: (1) capital conversion costs and

(2) product conversion costs. Capital conversion costs are investments in property, plant,

and equipment necessary to adapt or change existing production facilities such that new

compliant product designs can be fabricated and assembled. Product conversion costs are

investments in research, development, testing, marketing, and other non-capitalized costs

necessary to make product designs comply with amended energy conservation standards.

Id.

138

DOE relied on manufacturer feedback to evaluate the level of capital and product

conversion costs manufacturers would likely incur at the various TSLs. During

confidential interviews, DOE asked manufacturers to estimate the capital conversion

costs (e.g., changes in production processes, equipment, and tooling) to meet the various

efficiency levels. DOE also asked manufacturers to estimate the redesign effort and

engineering resources required at various efficiency levels to quantify the product

conversion costs. Based on manufacturer feedback, DOE also estimated “re-flooring”

costs associated with replacing obsolete display models in big-box stores (e.g., Lowe’s,

Home Depot, Best Buy) due to higher standards. Some manufacturers stated that with a

new product release, big-box retailers discount outdated display models, and

manufacturers share any losses associated with discounting the retail price. The

estimated re-flooring costs for each efficiency level were incorporated into the product

conversion cost estimates, as DOE modeled the re-flooring costs as a marketing expense.

DOE reviewed the DOE CCD,

U.S. market share estimates, and company

characteristics to scale the company-specific conversion cost estimates to levels that

represent the overall industry. First, DOE used data from its CCD,

the ENERGY

STAR-qualified product database,

and the California Energy Commission database

identify original equipment manufacturers (“OEMs”) of the covered products. Next,

DOE assessed each OEM’s U.S. market share and product profile (e.g., estimated sales

U.S. Department of Energy’s Compliance Certification Database is available at

www.regulations.doe.gov/certification-data (last accessed April 28, 2023).

Id.

ENERGY STAR Product Finder data set, available at www.energystar.gov/productfinder (last accessed

April 28, 2023).

California Energy Commission Modernized Appliance Efficiency Database System, available at

cacertappliances.energy.ca.gov/Pages/Search/AdvancedSearch.aspx (last accessed April 28, 2023).

139

by product class and efficiency) for consumer clothes dryers. Finally, DOE estimated

industry-level conversion cost estimates by scaling feedback from OEMs based on a

combination of product offerings and U.S. market share estimates.

DOE adjusted the conversion cost estimates developed in support of the August

2022 NOPR to 2022$ for this analysis. DOE also estimated industry costs associated

with appendix D2, as finalized in the October 2021 TP Final Rule. 86 FR 56608.

In general, DOE assumes all conversion-related investments occur between the

year of publication of the final rule and the year by which manufacturers must comply

with the new standard. The conversion cost figures used in the GRIM can be found in

section V.B.2.a of this document. For additional information on the estimated capital and

product conversion costs, see chapter 12 of the direct final rule TSD.

d. Manufacturer Markup Scenarios

MSPs include direct manufacturing production costs (i.e., labor, materials, and

overhead estimated in DOE’s MPCs) and all non-production costs (i.e., SG&A, R&D,

and interest), along with profit. To calculate the MSPs in the GRIM, DOE applied

manufacturer markups to the MPCs estimated in the engineering analysis for each

product class and efficiency level. Modifying these markups in the standards case yields

different sets of impacts on manufacturers. For the MIA, DOE modeled two standards-

case scenarios to represent uncertainty regarding the potential impacts on prices and

profitability for manufacturers following the implementation of amended energy

conservation standards: (1) a preservation of gross margin percentage scenario and (2) a

140

preservation-of-operating profit scenario. These scenarios lead to different manufacturer

markup values that, when applied to the MPCs, result in varying revenue and cash flow

impacts.

Under the preservation of gross margin percentage scenario, DOE applied a single

uniform “gross margin percentage” across all efficiency levels, which assumes that

manufacturers would be able to maintain the same amount of profit as a percentage of

revenues at all efficiency levels within a product class. As manufacturer production costs

increase with efficiency, this scenario implies that the per-unit dollar profit will increase.

DOE assumed a gross margin percentage of approximately 21 percent for all product

classes.

Manufacturers tend to believe it is optimistic to assume that they would be able

to maintain the same gross margin percentage as their production costs increase,

particularly for minimally efficient products. Therefore, this scenario represents a high

bound to industry profitability under an amended energy conservation standard.

Under the preservation of operating profit scenario, DOE modeled a situation in

which manufacturers are not able to increase per-unit operating profit in proportion to

increases in manufacturer production costs. DOE implemented this scenario in the

GRIM by lowering the manufacturer markups at each TSL to yield approximately the

same earnings before interest and taxes in the standards case as in the no-new-standards

case in the year after the compliance date of the amended standards. The implicit

The gross margin percentage of 21 percent is based on a manufacturer markup of 1.26.

141

assumption behind this scenario is that the industry can only maintain its operating profit

in absolute dollars after the standard.

A comparison of industry financial impacts under the two manufacturer markup

scenarios is presented in section V.B.2.a of this document.

3. Discussion of MIA Comments

For this direct final rule, DOE considered comments it had received regarding its

manufacturer impact analysis presented in the August 2022 NOPR. The approach used

for this direct final rule is largely the same as the approach DOE had used for the August

2022 NOPR analysis.

AHAM requested that DOE confirm it has fully included all costs that

manufacturers would face in compliance to assure that the financial effects on

manufacturers are not excessive. (AHAM, No. 46 at p. 11)

As discussed in section IV.J.2.c of this document, DOE primarily relied on

manufacturer feedback to estimate the capital and product conversion costs that

manufacturers would likely incur at the various analyzed efficiency levels. DOE did not

receive additional feedback about its conversion cost estimates published in the August

2022 NOPR. Therefore, DOE did not significantly alter its conversion cost methodology

in evaluating this direct final rule. DOE adjusted the conversion cost estimates developed

in support of the NOPR to 2022$ for this analysis. Additionally, for this direct final rule,

DOE updated its product conversion cost estimates to incorporate the estimated industry

142

costs associated with rerating basic models in accordance with appendix D2. 86 FR

56608.

AHAM stated that if DOE is to consider amending energy conservation standards,

it must incorporate into its analysis the challenges manufacturers are facing regarding the

COVID-19 pandemic and increased tariffs. AHAM commented that DOE cannot simply

rely on its previous analysis regarding component costs. (AHAM, No. 46 at pp. 13–14)

For this direct final rule, DOE updated its engineering analysis to incorporate up-

to-date cost estimates. Increased costs associated with recent supply chain challenges

stemming from the COVID-19 pandemic have been incorporated into the cost analysis by

way of 5-year moving averages for materials and the most up-to-date costs for purchased

parts.

AHAM stated that there will be an additional design cycle for either or both

clothes washers and clothes dryers if the effective dates for the two products are out of

sync. AHAM stated that the existing DOE analysis does not capture this situation, which

creates a significant technical and financial burden on manufacturers. (AHAM, No. 46 at

p. 11) AHAM stated its support for the ongoing Peer Review process regarding

cumulative regulatory burden and stated that DOE should not discount the time and

resources needed to evaluate and respond to all proposed test procedures and energy

conservation standards for multiple products proposed over a short period. AHAM

commented that when these rulemakings occur simultaneously, the cumulative burden

increases dramatically. (AHAM, No. 46 at p. 13)

143

DOE notes that it is adopting the Recommended TSL in this direct final rule. The

Joint Agreement included recommendations for other appliance standards rulemakings:

residential clothes washers; consumer clothes dryers; consumer conventional cooking

products; dishwashers; refrigerators, refrigerator-freezers, and freezers; and

miscellaneous refrigeration products. The signatories indicate that the Joint Agreement

for the six rulemakings should be considered as a joint recommendation of standards, to

be adopted in its entirety. (Joint Agreement, No. 55 at p. 3) The Joint Agreement

specifies a compliance date of March 1, 2028 for both residential clothes washers and

consumer clothes dryers. Therefore, DOE did not adjust its conversion cost estimates to

account for the time and investments associated with an additional design cycle as DOE

assumed the compliance dates for residential clothes washers and consumer clothes

dryers would align.

AHAM urged DOE to incorporate the financial results of the current cumulative

regulatory burden analysis directly into the MIA and stated that this is achievable by

adding the combined costs of complying with multiple regulations into the Product

Conversion Costs in the GRIM model and including the costs to manufacturers of

responding to and monitoring regulations. (AHAM, No. 46 at p. 11) AHAM requested

that DOE explicitly recognize the industry effects of multiple regulations issued within a

short period of time on the same product. AHAM stated that the MIA inherently assumes

the regulation analyzed in the INPV analysis is a single event (investment) and that all

other cash flows are unaffected by this regulation. In addition, AHAM stated that when

there are multiple regulations on the same product within the 6-year lock-in period, the

second regulation violates the recoupment assumption inherent in the first one, which is

144

not considered by the GRIM model. AHAM stated that DOE could resolve this by

conducting a consolidated analysis for multiple regulations starting from the time of the

first regulation or by incorporating a value reduction factor in the first post-regulation

year of the analysis that subtracts the value lost from the remaining years of the previous

regulation. (Id. at pp. 11–12)

If DOE were to combine the conversion costs from multiple regulations, as

requested, it would be appropriate to match the combined conversion costs with the

combined revenues of the regulated products. DOE is concerned that combined results

would make it more difficult to discern the direct impact of the amended standard on

covered manufacturers, particularly for rulemakings where there is only partial overlap of

manufacturers. Conversion costs would be spread over a larger revenue base and result in

less severe INPV impacts when evaluated on a percent change basis. Furthermore, DOE

is not aware of other Federal, product-specific regulations on consumer clothes dryers

that would go into effect 3 years before or after the 2028 compliance date. DOE

understands that if the effective dates of the consumer clothes dryer and residential

clothes washer amended standards were misaligned, there could be additional

development and marketing costs associated with aligning the design cycles of these

products, as clothes dryers and clothes washers are typically designed and sold in pairs.

However, DOE did not account for any additional development cost associated with this

potential regulatory burden, as DOE modeled the recommended March 1, 2028

compliance date from the Joint Agreement for both rulemakings.

145

AHAM urged DOE to weigh in against regulatory misalignment with Natural

Resources Canada (“NRCan”) through the United States-Canada Regulatory Cooperation

Council work plan on energy efficiency and under the Memorandum of Understanding

("MOU") on energy cooperation. AHAM also urged DOE to account for the burden of

any misalignment in its analysis. According to AHAM, it is critical that amended

standards are coordinated with NRCan, in both substance and timing, to maintain a

consistent United States-Canadian market for home appliances. (AHAM, No. 46 at p. 13)

As part of the analysis underlying the energy conservation standards for consumer

clothes dryers, DOE considers and reviews standards programs from other regions. As

part of this effort, DOE considers regulatory actions undertaken by NRCan and notes that

per a notice published on April 2, 2022 in the Canada Gazette, Part I,

NRCan is

currently proceeding with pre-consultations to align the energy efficiency and testing

standard for five home appliance categories including consumer clothes dryer with the

outcomes of the current DOE regulatory efforts. Further detail regarding DOE’s review

of the NRCan regulatory actions and those in other regions are discussed in chapter 3 of

the direct final rule TSD.

K. Emissions Analysis

The emissions analysis consists of two components. The first component

estimates the effect of potential energy conservation standards on power sector and site

(where applicable) combustion emissions of CO

, NO

, SO

, and Hg. The second

The notice published in the Canada Gazette, Part I can be found at: gazette.gc.ca/rp-pr/p1/2022/2022-04-

02/html/notice-avis-eng.html#ne4.

146

component estimates the impacts of potential standards on emissions of two additional

greenhouse gases, CH

and N

O, as well as the reductions in emissions of other gases due

to “upstream” activities in the fuel production chain. These upstream activities comprise

extraction, processing, and transporting fuels to the site of combustion.

The analysis of electric power sector emissions of CO

, NO

, SO

, and Hg uses

emissions intended to represent the marginal impacts of the change in electricity

consumption associated with amended or new standards. The methodology is based on

results published for the AEO, including a set of side cases that implement a variety of

efficiency-related policies. The methodology is described in appendix 13A in the direct

final rule TSD. The analysis presented in this notice uses projections from AEO2023.

Power sector emissions of CH

and N

O from fuel combustion are estimated using

Emission Factors for Greenhouse Gas Inventories published by the Environmental

Protection Agency (EPA).

The on-site operation of consumer clothes dryers involves combustion of fossil

fuels and results in emissions of CO

, NO

, SO

, CH

, and N

O where these products are

used. Site emissions of these gases were estimated using Emission Factors for

Greenhouse Gas Inventories and, for NO

and SO

emissions intensity factors from an

EPA publication.

Available at www.epa.gov/sites/production/files/2021-04/documents/emission-factors_apr2021.pdf (last

accessed April 6, 2023).

U.S. Environmental Protection Agency. External Combustion Sources. In Compilation of Air Pollutant

Emission Factors. AP-42. Fifth Edition. Volume I: Stationary Point and Area Sources. Chapter 1.

147

FFC upstream emissions, which include emissions from fuel combustion during

extraction, processing, and transportation of fuels, and “fugitive” emissions (direct

leakage to the atmosphere) of CH

and CO

, are estimated based on the methodology

described in chapter 15 of the direct final rule TSD.

The emissions intensity factors are expressed in terms of physical units per MWh

or MMBtu of site energy savings. For power sector emissions, specific emissions

intensity factors are calculated by sector and end use. Total emissions reductions are

estimated using the energy savings calculated in the national impact analysis.

1. Air Quality Regulations Incorporated in DOE’s Analysis

DOE’s no-new-standards case for the electric power sector reflects the AEO,

which incorporates the projected impacts of existing air quality regulations on emissions.

AEO2023 generally represents current legislation and environmental regulations,

including recent government actions, that were in place at the time of preparation of

AEO2023, including the emissions control programs discussed in the following

paragraphs.

emissions from affected electric generating units (“EGUs”) are subject to

nationwide and regional emissions cap-and-trade programs. Title IV of the Clean Air Act

sets an annual emissions cap on SO

for affected EGUs in the 48 contiguous States and

Available at www.epa.gov/air-emissions-factors-and-quantification/ap-42-compilation-air-emissions-

factors#Proposed/ (last accessed May 26, 2023).

For further information, see the Assumptions to AEO2023 report that sets forth the major assumptions

used to generate the projections in the Annual Energy Outlook. Available at

www.eia.gov/outlooks/aeo/assumptions/ (last accessed May 26, 2023).

148

the District of Columbia (“D.C.”). (42 U.S.C. 7651 et seq.) SO

emissions from

numerous States in the eastern half of the United States are also limited under the Cross-

State Air Pollution Rule (“CSAPR”). 76 FR 48208 (Aug. 8, 2011). CSAPR requires

these States to reduce certain emissions, including annual SO

emissions, and went into

effect as of January 1, 2015.

AEO2023 incorporates implementation of CSAPR,

including the update to the CSAPR ozone season program emission budgets and target

dates issued in 2016. 81 FR 74504 (Oct. 26, 2016). Compliance with CSAPR is flexible

among EGUs and is enforced through the use of tradable emissions allowances. Under

existing EPA regulations, for states subject to SO

emissions limits under CSAPR, any

excess SO

emissions allowances resulting from the lower electricity demand caused by

the adoption of an efficiency standard could be used to permit offsetting increases in SO

emissions by another regulated EGU.

However, beginning in 2016, SO

emissions began to fall as a result of the

Mercury and Air Toxics Standards (“MATS”) for power plants. 77 FR 9304 (Feb. 16,

2012). The direct final rule establishes power plant emission standards for mercury, acid

gases, and non-mercury metallic toxic pollutants. In order to continue operating, coal

plants must have either flue gas desulfurization or dry sorbent injection systems installed.

Both technologies, which are used to reduce acid gas emissions, also reduce SO

CSAPR requires states to address annual emissions of SO

and NO

, precursors to the formation of fine

particulate matter (“PM

2.5

”) pollution, in order to address the interstate transport of pollution with respect to

the 1997 and 2006 PM

2.5

National Ambient Air Quality Standards (“NAAQS”). CSAPR also requires

certain states to address the ozone season (May–September) emissions of NO

, a precursor to the formation

of ozone pollution, in order to address the interstate transport of ozone pollution with respect to the 1997

ozone NAAQS. 76 FR 48208 (Aug. 8, 2011). EPA subsequently issued a supplemental rule that included

an additional five states in the CSAPR ozone season program; 76 FR 80760 (Dec. 27, 2011) (Supplemental

Rule), and EPA issued the CSAPR Update for the 2008 ozone NAAQS. 81 FR 74504 (Oct. 26, 2016).

149

emissions. Because of the emissions reductions under the MATS, it is unlikely that

excess SO

emissions allowances resulting from the lower electricity demand would be

needed or used to permit offsetting increases in SO

emissions by another regulated EGU.

Therefore, energy conservation standards that decrease electricity generation will

generally reduce SO

emissions. DOE estimated SO

emissions reduction using

emissions factors based on AEO2023.

CSAPR also established limits on NO

emissions for numerous States in the

eastern half of the United States. Energy conservation standards would have little effect

on NO

emissions in those States covered by CSAPR emissions limits if excess NO

emissions allowances resulting from the lower electricity demand could be used to permit

offsetting increases in NO

emissions from other EGUs. In such case, NO

emissions

would remain near the limit even if electricity generation goes down. Depending on the

configuration of the power sector in the different regions and the need for allowances,

however, NO

emissions might not remain at the limit in the case of lower electricity

demand. That would mean that standards might reduce NO

emissions in covered States.

Despite this possibility, DOE has chosen to be conservative in its analysis and has

maintained the assumption that standards will not reduce NO

emissions in States

covered by CSAPR. Standards would be expected to reduce NO

emissions in the States

not covered by CSAPR. DOE used AEO2023 data to derive NO

emissions factors for

the group of States not covered by CSAPR.

The MATS limit mercury emissions from power plants, but they do not include

emissions caps and, as such, DOE’s energy conservation standards would be expected to

150

slightly reduce Hg emissions. DOE estimated mercury emissions reduction using

emissions factors based on AEO2023, which incorporates the MATS.

EEI stated that the emissions estimates are significantly overstated with the

passage of the Inflation Reduction Act (“IRA”). EEI recommended that DOE update the

analysis to account for the IRA and all the impacts in terms of the significantly increased

use of renewable electricity as well as the increase in the number of utilities that have

stated zero carbon electricity can be attained within the next 15 to 25 years. (EEI, No. 37

at pp. 54–55)

As previously stated, for the direct final rule DOE used the AEO2023 Reference

case, which includes the IRA, to represent the electric power sector over the coming

decades. The AEO2023 Reference case reflects EIA’s view of the most likely uptake of

IRA tax credits, and it assumes qualified technologies receive the base tax credit and

some bonus credits. The IRA provisions, in combination with other policies and market

forces, push wind and solar to 56 percent of electricity generation by 2050. DOE

estimated emissions reductions from the adopted standards relative to this case.

L. Monetizing Emissions Impacts

As part of the development of this direct final rule, for the purpose of complying

with the requirements of Executive Order 12866, DOE considered the estimated

monetary benefits from the reduced emissions of CO

, CH

, N

O, NO

, and SO

that are

expected to result from each of the TSLs considered. In order to make this calculation

analogous to the calculation of the NPV of consumer benefit, DOE considered the

151

reduced emissions expected to result over the lifetime of products shipped in the

projection period for each TSL. This section summarizes the basis for the values used for

monetizing the emissions benefits and presents the values considered in this direct final

rule.

To monetize the benefits of reducing GHG emissions, this analysis uses the

interim estimates presented in the Technical Support Document: Social Cost of Carbon,

Methane, and Nitrous Oxide Interim Estimates Under Executive Order 13990 published

in February 2021 by the IWG.

1. Monetization of Greenhouse Gas Emissions

DOE estimates the monetized benefits of the reductions in emissions of CO

, and N

O by using a measure of the SC of each pollutant (e.g., social costs of

greenhouse gases “SC-CO

”). These estimates represent the monetary value " of the net

harm to society associated with a marginal increase in emissions of these pollutants in a

given year, or the benefit of avoiding that increase. These estimates are intended to

include (but are not limited to) climate change-related changes in net agricultural

productivity, human health, property damages from increased flood risk, disruption of

energy systems, risk of conflict, environmental migration, and the value of ecosystem

services.

DOE exercises its own judgment in presenting monetized climate benefits as

recommended by applicable Executive orders, and DOE would reach the same

conclusion presented in this rulemaking in the absence of the social cost of greenhouse

152

gases. That is, the SC-CO

, whether measured using the February 2021 interim estimates

presented by the Interagency Working Group on the Social Cost of Greenhouse Gases or

by another means, did not affect the rule ultimately proposed by DOE.

DOE estimated the global social benefits of CO

, CH

, and N

O reductions using

SC-GHG values that were based on the interim values presented in the Technical Support

Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates under

Executive Order 13990, published in February 2021 by the IWG. The SC-GHG is the

monetary value of the net harm to society associated with a marginal increase in

emissions in a given year, or the benefit of avoiding that increase. In principle, the SC-

GHG includes the value of all climate change impacts, including (but not limited to)

changes in net agricultural productivity, human health effects, property damage from

increased flood risk and natural disasters, disruption of energy systems, risk of conflict,

environmental migration, and the value of ecosystem services. The SC-GHG therefore

reflects the societal value of reducing emissions of the gas in question by one metric ton.

The SC-GHG is the theoretically appropriate value to use in conducting benefit-cost

analyses of policies that affect CO

, N

O, and CH

emissions. As a member of the IWG

involved in the development of the February 2021 SC-GHG TSD, DOE agrees that the

interim SC-GHG estimates represent the most appropriate estimate of the SC-GHG for

this rule, which was developed using the interim estimates. DOE continues to evaluate

recent developments in the scientific literature, including the updated SC-GHG estimates

published by the EPA in December 2023 within their rulemaking on oil and natural gas

153

sector sources.

For this rulemaking, DOE used these updated SC-GHG values to

conduct a sensitivity analysis of the value of GHG emissions reductions associated with

alternative standards for clothes dryers (see section IV.L.1.c of this document).

The SC-GHG estimates presented here were developed over many years, using

peer-reviewed methodologies, a transparent process, the best science available at the time

of that process, and input from the public. Specifically, in 2009, the IWG, which included

DOE and other executive branch agencies and offices, was established to ensure that

agencies were using the best available science and to promote consistency in the SC-CO

values used across agencies. The IWG published SC-CO

estimates in 2010 that were

developed from an ensemble of three widely cited integrated assessment models

(“IAMs”) that estimate global climate damages using highly aggregated representations

of climate processes and the global economy combined into a single modeling

framework. The three IAMs were run using a common set of input assumptions in each

model for future population, economic, and CO

emissions growth, as well as equilibrium

climate sensitivity—a measure of the globally averaged temperature response to

increased atmospheric CO

concentrations. These estimates were updated in 2013 based

on new versions of each IAM. In August 2016 the IWG published estimates of the social

cost of methane (“SC-CH

”) and nitrous oxide (“SC-N

O”) using methodologies that are

consistent with the methodology underlying the SC-CO

estimates. The modeling

approach that extends the IWG SC-CO

methodology to non-CO

GHGs has undergone

Available at www.epa.gov/system/files/documents/2023-12/eo12866_oil-and-gas-nsps-eg-climate-

review-2060-av16-final-rule-20231130.pdf.

154

multiple stages of peer review. The SC-CH

and SC-N

O estimates were developed by

Marten et al.

and underwent a standard double-blind peer review process prior to

journal publication. In 2015, as part of the response to public comments received

following a 2013 solicitation for comments on the SC-CO

estimates, the IWG

announced a National Academies of Sciences, Engineering, and Medicine review of the

SC-CO

estimates to offer advice on how to approach future updates to ensure that the

estimates continue to reflect the best available science and methodologies. In January

2017, the National Academies released their final report, Valuing Climate Damages:

Updating Estimation of the Social Cost of Carbon Dioxide, and recommended specific

criteria for future updates to the SC-CO

estimates, a modeling framework to satisfy the

specified criteria, and both near-term updates and longer-term research needs pertaining

to various components of the estimation process (National Academies, 2017).

Shortly

thereafter, in March 2017, President Trump issued Executive Order (“E.O.”) 13783,

which disbanded the IWG, withdrew the previous TSDs, and directed agencies to ensure

SC-CO

estimates used in regulatory analyses are consistent with the guidance contained

in OMB’s Circular A-4

100

, “including with respect to the consideration of domestic

versus international impacts and the consideration of appropriate discount rates” (E.O.

13783, Section 5(c)). Benefit-cost analyses following E.O. 13783 used SC-GHG

estimates that attempted to focus on the U.S.-specific share of climate change damages as

Marten, A.L., E.A. Kopits, C.W. Griffiths, S.C. Newbold, and A. Wolverton. Incremental CH4 and N2O

mitigation benefits consistent with the U.S. Government’s SC-CO

estimates. Climate Policy. 2015. 15(2):

pp. 272–298.

National Academies of Sciences, Engineering, and Medicine. Valuing Climate Damages: Updating

Estimation of the Social Cost of Carbon Dioxide. 2017. The National Academies Press: Washington, DC.

100

U.S. Office of Management and Budget. Circular A-4: Regulatory Analysis. Available at

www.whitehouse.gov/omb/information-for-agencies/circulars/ (last accessed April 20, 2023).

DOE used the prior version of Circular A-4 (2003) as a result of the effective date of the new version.

155

estimated by the models and were calculated using two discount rates recommended by

Circular A-4, 3 percent and 7 percent. All other methodological decisions and model

versions used in SC-GHG calculations remained the same as those used by the IWG in

2010 and 2013, respectively.

On January 20, 2021, President Biden issued Executive Order 13990, which re-

established the IWG and directed it to ensure that the U.S. Government’s estimates of the

social cost of carbon and other greenhouse gases reflect the best available science and the

recommendations of the National Academies (2017). The IWG was tasked with first

reviewing the SC-GHG estimates currently used in Federal analyses and publishing

interim estimates within 30 days of E.O. 13990 that reflect the full impact of GHG

emissions, including by taking global damages into account. The interim SC-GHG

estimates published in February 2021 are used here to estimate the climate benefits for

this rulemaking. E.O. 13990 instructs the IWG to undertake a fuller update of the SC-

GHG estimates by January 2022 that takes into consideration the advice of the National

Academies (2017) and other recent scientific literature. The February 2021 SC-GHG

TSD provides a complete discussion of the IWG’s initial review conducted under E.O.

13990. In particular, the IWG found that the SC-GHG estimates used under E.O. 13783

fail to reflect the full impact of GHG emissions in multiple ways.

First, the IWG found that the SC-GHG estimates used under E.O. 13783 fail to

fully capture many climate impacts that affect the welfare of U.S. citizens and residents,

and those impacts are better reflected by global measures of the SC-GHG. Examples of

omitted effects from the E.O. 13783 estimates include direct effects on U.S. citizens,

156

assets, and investments located abroad; supply chains, U.S. military assets and interests

abroad, and tourism; and spillover pathways such as economic and political

destabilization and global migration that can lead to adverse impacts on U.S. national

security, public health, and humanitarian concerns. In addition, assessing the benefits of

United States GHG mitigation activities requires consideration of how those actions may

affect mitigation activities by other countries, as those international mitigation actions

will provide a benefit to United States citizens and residents by mitigating climate

impacts that affect United States citizens and residents. A wide range of scientific and

economic experts have emphasized the issue of reciprocity as support for considering

global damages of GHG emissions. If the United States does not consider impacts on

other countries, it is difficult to convince other countries to consider the impacts of their

emissions on the United States. The only way to achieve an efficient allocation of

resources for emissions reduction on a global basis—and so benefit the United States and

its citizens—is for all countries to base their policies on global estimates of damages. As

a member of the IWG involved in the development of the February 2021 SC-GHG TSD,

DOE agrees with this assessment and, therefore, in this direct final rule DOE centers

attention on a global measure of SC-GHG. This approach is the same as that taken in

DOE regulatory analyses from 2012 through 2016. A robust estimate of climate damages

that accrue only to U.S. citizens and residents does not currently exist in the literature. As

explained in the February 2021 TSD, existing estimates are both incomplete and an

underestimate of total damages that accrue to the citizens and residents of the U.S.

because they do not fully capture the regional interactions and spillovers previously

discussed, nor do they include all of the important physical, ecological, and economic

157

impacts of climate change recognized in the climate change literature. As noted in the

February 2021 SC-GHG TSD, the IWG will continue to review developments in the

literature, including more robust methodologies for estimating a U.S.-specific SC-GHG

value, and explore ways to better inform the public of the full range of carbon impacts.

As a member of the IWG, DOE will continue to follow developments in the literature

pertaining to this issue.

Second, the IWG found that the use of the social rate of return on capital (7

percent under current OMB Circular A-4 guidance) to discount the future benefits of

reducing GHG emissions inappropriately underestimates the impacts of climate change

for the purposes of estimating the SC-GHG. Consistent with the findings of the National

Academies (2017) and the economic literature, the IWG continued to conclude that the

consumption rate of interest is the theoretically appropriate discount rate in an

intergenerational context

101

and recommended that discount rate uncertainty and relevant

101

Interagency Working Group on Social Cost of Carbon, United States Government. Technical Support

Document: Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866. 2010.

Available at www.epa.gov/sites/default/files/2016-12/documents/scc_tsd_2010.pdf (last accessed April 15,

2022);

Interagency Working Group on Social Cost of Carbon, United States Government. Technical Support

Document: Technical Update of the Social Cost of Carbon for Regulatory Impact Analysis Under

Executive Order 12866. 2013.

Available at www.federalregister.gov/documents/2013/11/26/2013-28242/technical-support-document-

technical-update-of-the-social-cost-of-carbon-for-regulatory-impact (last accessed April 15, 2022);

Interagency Working Group on Social Cost of Greenhouse Gases, United States Government. Technical

Support Document: Technical Update on the Social Cost of Carbon for Regulatory Impact Analysis Under

Executive Order 12866. August 2016. Available at www.epa.gov/sites/default/files/2016-

12/documents/sc_co2_tsd_august_2016.pdf (last accessed Jan. 18, 2022);

Interagency Working Group on Social Cost of Greenhouse Gases, United States Government. Addendum

to Technical Support Document on Social Cost of Carbon for Regulatory Impact Analysis Under Executive

Order 12866: Application of the Methodology to Estimate the Social Cost of Methane and the Social Cost

of Nitrous Oxide. August 2016. Available at www.epa.gov/sites/default/files/2016-

12/documents/addendum_to_sc-ghg_tsd_august_2016.pdf (last accessed Jan. 18, 2022).

158

aspects of intergenerational ethical considerations be accounted for in selecting future

discount rates.

Furthermore, the damage estimates developed for use in the SC-GHG are

estimated in consumption-equivalent terms, and so an application of OMB Circular A-4's

guidance for regulatory analysis would then use the consumption discount rate to

calculate the SC-GHG. DOE agrees with this assessment and will continue to follow

developments in the literature pertaining to this issue. DOE also notes that while OMB

Circular A-4, as published in 2003, recommends using 3-percent and 7-percent discount

rates as “default” values, Circular A-4 also reminds agencies that “different regulations

may call for different emphases in the analysis, depending on the nature and complexity

of the regulatory issues and the sensitivity of the benefit and cost estimates to the key

assumptions.” On discounting, Circular A-4 recognizes that “special ethical

considerations arise when comparing benefits and costs across generations,” and Circular

A-4 acknowledges that analyses may appropriately “discount future costs and

consumption benefits…at a lower rate than for intragenerational analysis.” In the 2015

Response to Comments on the Social Cost of Carbon for Regulatory Impact Analysis,

OMB, DOE, and the IWG members recognized that "Circular A-4 is a living document"

and “the use of 7 percent is not considered appropriate for intergenerational discounting.

There is wide support for this view in the academic literature, and it is recognized in

Circular A-4 itself.” Thus, DOE concludes that a 7-percent discount rate is not

appropriate to apply to value the social cost of greenhouse gases in the analysis presented

in this document.

159

To calculate the present and annualized values of climate benefits, DOE uses the

same discount rate as the rate used to discount the value of damages from future GHG

emissions for internal consistency. That approach to discounting follows the same

approach that the February 2021 TSD recommends "to ensure internal consistency—i.e.,

future damages from climate change using the SC-GHG at 2.5 percent should be

discounted to the base year of the analysis using the same 2.5 percent rate.” DOE has also

consulted the National Academies’ 2017 recommendations on how SC-GHG estimates

can “be combined in RIAs with other cost and benefits estimates that may use different

discount rates.” The National Academies reviewed several options, including “presenting

all discount rate combinations of other costs and benefits with [SC-GHG] estimates.”

As a member of the IWG involved in the development of the February 2021 SC-

GHG TSD, DOE agrees with the above assessment and will continue to follow

developments in the literature pertaining to this issue. While the IWG works to assess

how best to incorporate the latest, peer-reviewed science to develop an updated set of SC-

GHG estimates, it set the interim estimates to be the most recent estimates developed by

the IWG prior to the group being disbanded in 2017. The estimates rely on the same

models and harmonized inputs and are calculated using a range of discount rates. As

explained in the February 2021 SC-GHG TSD, the IWG has recommended that agencies

revert to the same set of four values drawn from the SC-GHG distributions based on three

discount rates as were used in regulatory analyses between 2010 and 2016 and were

subject to public comment. For each discount rate, the IWG combined the distributions

across models and socioeconomic emissions scenarios (applying equal weight to each)

and then selected a set of four values recommended for use in benefit-cost analyses: an

160

average value resulting from the model runs for each of three discount rates (2.5 percent,

3 percent, and 5 percent) plus a fourth value, selected as the 95th percentile of estimates

based on a 3-percent discount rate. The fourth value was included to provide information

on potentially higher-than-expected economic impacts from climate change. As explained

in the February 2021 SC-GHG TSD, with which DOE agrees, this update reflects the

immediate need to have an operational SC-GHG for use in regulatory benefit-cost

analyses and other applications that was developed using a transparent process, peer-

reviewed methodologies, and the science available at the time of that process. Those

estimates were subject to public comment in dozens of proposed rulemakings as well as

in a dedicated public comment period in 2013.

There are a number of limitations and uncertainties associated with the SC-GHG

estimates. First, the current scientific and economic understanding of discounting

approaches suggests discount rates appropriate for intergenerational analysis in the

context of climate change are likely to be less than 3 percent, near 2 percent, or lower.

102

Second, the IAMs used to produce these interim estimates do not include all of the

important physical, ecological, and economic impacts of climate change recognized in

the climate change literature, and the science underlying their “damage functions”—i.e.,

the core parts of the IAMs that map global mean temperature changes and other physical

impacts of climate change into economic (both market and nonmarket) damages—lags

behind the most recent research. For example, limitations include the incomplete

102

Interagency Working Group on Social Cost of Greenhouse Gases (IWG), United States Government.

Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates Under

Executive Order 13990. February 2021. Available at www.whitehouse.gov/briefing-

room/blog/2021/02/26/a-return-to-science-evidence-based-estimates-of-the-benefits-of-reducing-climate-

pollution/ (last accessed May 23, 2023).

161

treatment of catastrophic and non-catastrophic impacts in the integrated assessment

models, their incomplete treatment of adaptation and technological change, the

incomplete way in which interregional and intersectoral linkages are modeled,

uncertainty in the extrapolation of damages to high temperatures, and inadequate

representation of the relationship between the discount rate and uncertainty in economic

growth over long time horizons. Likewise, the socioeconomic and emissions scenarios

used as inputs to the models do not reflect new information from the last decade of

scenario generation or the full range of projections. The modeling limitations do not all

work in the same direction in terms of their influence on the SC-CO

estimates. However,

as discussed in the February 2021 TSD, the IWG has recommended that, taken together,

the limitations suggest that the interim SC-GHG estimates used in this direct final rule

likely underestimate the damages from GHG emissions. DOE concurs with this

assessment.

DOE's derivations of the SC-CO

, SC-N

O, and SC-CH

values used for this

direct final rule are discussed in the following sections, and the results of DOE's analyses

estimating the benefits of the reductions in emissions of these GHGs are presented in

section V.B.6 of this document.

a. Social Cost of Carbon

The SC-CO

values used for this direct final rule were based on the values

developed for the IWG’s February 2021 TSD, which are shown in Table IV.22 in 5-year

increments from 2020 to 2050. The set of annual values that DOE used, which was

162

adapted from estimates published by EPA,

103

is presented in appendix 14A of the direct

final rule TSD. These estimates are based on methods, assumptions, and parameters

identical with the 2020–2050 estimates published by the IWG (which were based on EPA

modeling) and include values for 2051 to 2070. DOE expects additional climate benefits

to accrue for any longer-life consumer clothes dryers after 2070, but a lack of available

SC-CO

estimates for emissions years beyond 2070 prevents DOE from monetizing these

potential benefits in this analysis.

For purposes of capturing the uncertainties involved in regulatory impact analysis,

DOE has determined it is appropriate to include all four sets of SC-CO

values, as

recommended by the IWG.

104

Table IV.22 Annual SC-CO

Values from 2021 Interagency Update, 2020–2050

(2020$ per Metric Ton CO

)

Year

Discount Rate and Statistic

2.5%

Average Average Average

percentile

2020

152

2025

169

2030

187

2035

206

2040

103

225

2045

110

242

2050

116

260

103

See EPA, Revised 2023 and Later Model Year Light-Duty Vehicle GHG Emissions Standards:

Regulatory Impact Analysis, Washington, D.C., December 2021. Available at

nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P1013ORN.pdf (last accessed Feb. 21, 2023).

104

For example, the February 2021 TSD discusses how the understanding of discounting approaches

suggests that discount rates appropriate for intergenerational analysis in the context of climate change may

be lower than 3 percent.

163

DOE multiplied the CO

emissions reduction estimated for each year by the SC-

value for that year in each of the four cases. DOE adjusted the values to 2022$

using the implicit price deflator for gross domestic product (“GDP”) from the Bureau of

Economic Analysis. To calculate a present value of the stream of monetary values, DOE

discounted the values in each of the four cases using the specific discount rate that had

been used to obtain the SC-CO

values in each case.

b. Social Cost of Methane and Nitrous Oxide

The SC-CH

and SC-N

O values used for this direct final rule were based on the

values developed for the February 2021 TSD. Table IV.23 shows the updated sets of SC-

and SC-N

O estimates from the latest interagency update in 5-year increments from

2020 to 2050. The full set of annual values used is presented in appendix 14A of the

direct final rule TSD. To capture the uncertainties involved in regulatory impact

analysis, DOE has determined it is appropriate to include all four sets of SC-CH

and SC-

O values, as recommended by the IWG. DOE derived values after 2050 using the

approach described above for the SC-CO

Table IV.23. Annual SC-CH

and SC-N

O Values from 2021 Interagency Update,

2020–2050 (2020$ per Metric Ton)

Year

SC-CH

SC-N

Discount Rate and Statistic

2.5%

2.5 %

Average Average Average

percentile

Average Average Average

percentile

2020

670

1500

2000

3900

5800

18000

27000

48000

2025

800

1700

2200

4500

6800

21000

30000

54000

2030

940

2000

2500

5200

7800

23000

33000

60000

2035

1100

2200

2800

6000

9000

25000

36000

67000

2040

1300

2500

3100

6700

10000

28000

39000

74000

2045

1500

2800

3500

7500

12000

30000

42000

81000

2050

1700

3100

3800

8200

13000

33000

45000

88000

164

DOE multiplied the CH

and N

O emissions reduction estimated for each year by

the SC-CH

and SC-N

O estimates for that year in each of the cases. DOE adjusted the

values to 2022$ using the implicit price deflator for gross domestic product (“GDP”)

from the Bureau of Economic Analysis. To calculate a present value of the stream of

monetary values, DOE discounted the values in each of the cases using the specific

discount rate that had been used to obtain the SC-CH

and SC-N

O estimates in each

case.

c. Sensitivity Analysis Using Updated 2023 SC-GHG Estimates

In December 2023 EPA issued a new set of SC-GHG estimates (2023 SC-GHG)

in connection with a final rulemaking under the Clean Air Act.

105

For this rulemaking,

DOE used these updated 2023 SC-GHG values to conduct a sensitivity analysis of the

value of GHG emissions reductions associated with alternative standards for consumer

clothes dryers. This sensitivity analysis provides an expanded range of potential climate

benefits associated with amended standards. The final year of EPA’s new the 2023 SC-

GHG estimates is 2080; therefore, DOE did not monetize the climate benefits of GHG

emissions reductions occurring after 2080.

The overall climate benefits are larger using when using the higher, updated 2023

SC-GHG estimates, compared to the climate benefits using the older IWG SC-GHG

estimates. However, DOE’s conclusion that the standards are economically justified

remains the same regardless of which SC-GHG estimates are used.

105

See www.epa.gov/environmental-economics/scghg.

165

The results of the sensitivity analysis are presented in appendix 14C of the direct

final rule TSD.

2. Monetization of Other Emissions Impacts

For the direct final rule, DOE estimated the monetized value of NO

and SO

emissions reductions from electricity generation using benefit-per-ton estimates for that

sector from the EPA’s Benefits Mapping and Analysis Program.

106

DOE used EPA’s

values for PM

2.5

-related benefits associated with NO

and SO

and for ozone-related

benefits associated with NO

for 2025 and 2030, and 2040, calculated with discount rates

of 3 percent and 7 percent. DOE used linear interpolation to define values for the years

not given in the 2025 to 2040 period; for years beyond 2040, the values are held constant.

DOE combined the EPA benefit-per-ton estimates with regional information on

electricity consumption and emissions to define weighted average national values for

and SO

as a function of sector (see appendix 14B of the direct final rule TSD).

DOE also estimated the monetized value of NO

and SO

emissions reductions

from site use of natural gas in consumer clothes dryers using benefit-per-ton estimates

from the EPA’s Benefits Mapping and Analysis Program. Although none of the sectors

covered by EPA refers specifically to residential and commercial buildings, the sector

called “area sources” would be a reasonable proxy for residential and commercial

106

Estimating the Benefit-per-Ton of Reducing Directly-Emitted PM2.5, PM2.5 Precursors and Ozone

Precursors from 21 Sectors. Available at www.epa.gov/benmap/estimating-benefit-ton-reducing-pm25-

precursors-21-sectors.

166

buildings.

107

The EPA document provides high and low estimates for 2025 and 2030 at

3- and 7-percent discount rates.

108

DOE used the same linear interpolation and

extrapolation as it did with the values for electricity generation.

DOE multiplied the site emissions reduction (in tons) in each year by the

associated $/ton values, and then discounted each series using discount rates of 3 percent

and 7 percent as appropriate.

For this direct final rule, DOE considered comments it had received regarding its

monetization emission impact analysis presented in the August 2022 NOPR. The

approach used for this direct final rule is largely the same as the approach DOE had used

for the August 2022 NOPR analysis.

In response to the August 2022 NOPR, AHAM disagreed with DOE’s use of both

the social cost of carbon (“SCC”) and other monetization of emissions reductions benefits

in its analysis of the factors that EPCA requires DOE to balance in determining the

appropriate standard, as these values are highly subjective and ever-changing. (AHAM,

No. 46 at p. 14)

As stated in section III.E.1.f of this document, DOE maintains that environmental

and public health benefits associated with more efficient use of energy, including those

107

“Area sources” represents all emission sources for which states do not have exact (point) locations in

their emissions inventories. Because exact locations would tend to be associated with larger sources, “area

sources” would be fairly representative of small, dispersed sources like homes and businesses.

108

“Area sources” are a category in the 2018 document from EPA but are not used in the 2021 document

cited above. See www.epa.gov/sites/default/files/2018-02/documents/sourceapportionmentbpttsd_2018.pdf.

167

connected to global climate change, are important to take into account when considering

the need for national energy conservation, which is one of the factors that EPCA requires

DOE to evaluate in determining whether a potential energy conservation standard is

economically justified. In addition, Executive Order 13563, which was reaffirmed on

January 21, 2021, stated that each agency must, among other things, “select, in choosing

among alternative regulatory approaches, those approaches that maximize net benefits

(including potential economic, environmental, public health and safety, and other

advantages; distributive impacts; and equity).” For these reasons, DOE includes

monetized emissions reductions in its evaluation of potential standard levels. As

previously stated, however, DOE would reach the same conclusion presented in this

rulemaking in the absence of the SC-GHG. At the Recommended TSL, the average LCC

savings for all product classes is positive. In addition, the FFC national energy savings

are significant and the NPV of consumer benefits is positive using both a 3-percent and

7-percent discount rate. Even when measured at the more conservative discount rate of 7

percent, the NPV of consumer benefits is over 64 times higher than the maximum

estimated manufacturers’ loss in INPV.

M. Utility Impact Analysis

The utility impact analysis estimates the changes in installed electrical capacity

and generation projected to result for each considered TSL. The analysis is based on

published output from the NEMS associated with AEO2023. NEMS produces the AEO

Reference case, as well as a number of side cases that estimate the economy-wide

impacts of changes to energy supply and demand. For the current analysis, impacts are

quantified by comparing the levels of electricity sector generation, installed capacity, fuel

168

consumption, and emissions in the AEO2023 Reference case and various side cases.

Details of the methodology are provided in the appendices to chapters 13 and 15 of the

direct final rule TSD.

The output of this analysis is a set of time-dependent coefficients that capture the

change in electricity generation, primary fuel consumption, installed capacity and power

sector emissions due to a unit reduction in demand for a given end use. These

coefficients are multiplied by the stream of electricity savings calculated in the NIA to

provide estimates of selected utility impacts of potential new or amended energy

conservation standards.

The utility analysis also estimates the impact on gas utilities in terms of projected

changes in natural gas deliveries to consumers for each TSL.

N. Employment Impact Analysis

DOE considers employment impacts in the domestic economy as one factor in

selecting a standard. Employment impacts from new or amended energy conservation

standards include both direct and indirect impacts. Direct employment impacts are any

changes in the number of employees of manufacturers of the products subject to

standards, their suppliers, and related service firms. The MIA addresses those impacts.

Indirect employment impacts are changes in national employment that occur due to the

shift in expenditures and capital investment caused by the purchase and operation of

more efficient appliances. Indirect employment impacts from standards consist of the net

jobs created or eliminated in the national economy, other than in the manufacturing sector

169

being regulated, caused by (1) reduced spending by consumers on energy, (2) reduced

spending on new energy supply by the utility industry, (3) increased consumer spending

on the products to which the new standards apply and other goods and services, and (4)

the effects of those three factors throughout the economy.

One method for assessing the possible effects on the demand for labor of such

shifts in economic activity is to compare sector employment statistics developed by the

Labor Department’s Bureau of Labor Statistics (“BLS”). BLS regularly publishes its

estimates of the number of jobs per million dollars of economic activity in different

sectors of the economy, as well as the jobs created elsewhere in the economy by this

same economic activity. Data from BLS indicate that expenditures in the utility sector

generally create fewer jobs (both directly and indirectly) than expenditures in other

sectors of the economy.

109

There are many reasons for these differences, including wage

differences and the fact that the utility sector is more capital-intensive and less labor-

intensive than other sectors. Energy conservation standards have the effect of reducing

consumer utility bills. Because reduced consumer expenditures for energy likely lead to

increased expenditures in other sectors of the economy, the general effect of efficiency

standards is to shift economic activity from a less labor-intensive sector (i.e., the utility

sector) to more labor-intensive sectors (e.g., the retail and service sectors). Thus, the

109

See U.S. Department of Commerce–Bureau of Economic Analysis. Regional Multipliers: A User

Handbook for the Regional Input-Output Modeling System (“RIMS II”). 1997. U.S. Government Printing

Office: Washington, DC. Available at www.osti.gov/biblio/7281092 (last accessed July 1, 2021).

170

BLS data suggest that net national employment may increase due to shifts in economic

activity resulting from energy conservation standards.

DOE estimated indirect national employment impacts for the standard levels

considered in this direct final rule using an input/output model of the U.S. economy

called Impact of Sector Energy Technologies version 4 (“ImSET”).

110

ImSET is a

special-purpose version of the “U.S. Benchmark National Input-Output” (“I-O”) model,

which was designed to estimate the national employment and income effects of energy-

saving technologies. The ImSET software includes a computer-based I-O model having

structural coefficients that characterize economic flows among 187 sectors most relevant

to industrial, commercial, and residential building energy use.

DOE notes that ImSET is not a general equilibrium forecasting model, and that

the uncertainties involved in projecting employment impacts, especially changes in the

later years of the analysis. Because ImSET does not incorporate price changes, the

employment effects predicted by ImSET may overestimate actual job impacts over the

long run for this rule. Therefore, DOE used ImSET only to generate results for near-term

timeframes (2027–2033) where these uncertainties are reduced.

111

For more details on

the employment impact analysis, see chapter 16 of the direct final rule TSD.

110

Livingston, O.V., S.R. Bender, M.J. Scott, and R.W. Schultz. ImSET 4.0: Impact of Sector Energy

Technologies Model Description and User’s Guide. 2015. Pacific Northwest National Laboratory:

Richland, WA. PNNL-24563. Available at

www.pnnl.gov/main/publications/external/technical_reports/PNNL-24563.pdf (last accessed April 26,

2023).

111

The near-term timeframes for the Recommended TSL are 2028–2034.

171

O. Regulatory Impact Analysis

For any regulatory action that the Administrator of the Office of Information and

Regulatory Affairs (“OIRA”) within OMB determines is a significant regulatory action

under section 3(f)(1) of E.O. 12866, section 6(a)(3)(C) of E.O. 12866 requires Federal

agencies to provide an assessment, including the underlying analysis, of costs and

benefits of potentially effective and reasonably feasible alternatives to the planned

regulation, identified by the agencies or the public (including improving the current

regulation and reasonably viable non-regulatory actions), and an explanation why the

planned regulatory action is preferable to the identified potential alternatives. 58 FR

51735, 51741. As discussed further in section VI.A of this document, OIRA has

determined that this final regulatory action constitutes a “significant regulatory action”

within the scope of section 3(f)(1) of E.O. 12866, as amended by E.O. 14094.

Accordingly, DOE conducted a regulatory impact analysis (“RIA”) for this direct final

rule.

As part of the RIA, DOE identifies major alternatives to standards that represent

feasible policy options to reduce the energy and water consumption of the covered

product. DOE evaluates each alternative in terms of its ability to achieve significant

energy and water savings at a reasonable cost, and compares the effectiveness of each

alternative to the effectiveness of the finalized standard. DOE recognizes that voluntary

or other non-regulatory efforts by manufacturers, utilities, and other interested parties can

substantially affect energy and water efficiency or reduce energy and water consumption.

DOE bases its assessment on the recorded impacts of any such initiatives to date, but also

considers information presented by interested parties regarding the impacts current

172

initiatives may have in the future. Further details regarding the RIA are provided in

chapter 17 of the direct final rule TSD.

P. Other Comments

As discussed previously, DOE considered relevant comments, data, and

information obtained during its own rulemaking process in determining whether the

recommended standards from the Joint Agreement are in accordance with 42 U.S.C.

6295(o). And while some of those comments were directed at specific aspects of DOE’s

analysis of the Joint Agreement under 42 U.S.C. 6295(o), others were more generally

applicable to DOE’s energy conservation standards rulemaking program as a whole. The

ensuing discussion focuses on these general comments concerning energy conservation

standards issued under EPCA.

The National Academies of Sciences, Engineering, and Medicine (“NAS”)

periodically appoint a committee to peer review the assumptions, models, and

methodologies that DOE uses in setting energy conservation standards for covered

products and equipment. The most recent such peer review was conducted in a series of

meetings in 2020, and NAS issued the report

112

in 2021 detailing its findings and

recommendations on how DOE can improve its analyses and align them with best

practices for cost-benefit analysis.

112

Review of Methods Used by the U.S. Department of Energy in Setting Appliance and Equipment

Standards (2021), available at nap.nationalacademies.org/25992.

173

AHAM recommended that DOE adopt the recommendations of the NAS report

and incorporate the Regulatory Impact Analysis methodology of Office of Management

and Budget (“OMB”) Circular A-4 and start with a more robust assessment of private

market failures and alternatives to minimum standards that includes a robust

identification and assessment of market failures by market segment. (AHAM, No. 46 at

pp. 12–13)

AGA and APGA also commented that DOE should implement recommendations

in the NAS report, specifically: appliance standards should be economically justified or

based on significant failures of private markets or irrational consumer behavior

(Recommendation 2-2); the Cost Analysis segment of the Engineering Analysis should

be expanded to include ranges of costs, patterns of consumption, diversity factors, energy

peak demand, and variance regarding environmental factors (Recommendation 3-5);

DOE should put greater weight on ex post and market-based evidence of markups to

project a more realistic range of effects of a standard on prices (Recommendation 4-1);

DOE should place greater emphasis on providing an argument for the plausibility and

magnitude of any market failure related to the energy efficiency gap in its analyses

(Recommendation 4-13); and DOE should give greater attention to a broader set of

potential market failures on the supply side, including how standards might reduce the

number of competing firms, and also how standards might impact price discrimination,

technological diffusion, and collusion (Recommendation 4-14). (APGA et al., No. 47 at

pp. 2–3)

174

The rulemaking process for standards of covered products and equipment are

outlined at appendix A to subpart C of 10 CFR part 430, and DOE periodically examines

and revises these provisions in separate rulemaking proceedings. The recommendations

in the NAS report cited by commenters on the August 2022 NOPR, which pertain to the

processes by which DOE analyzes energy conservation standards, will be considered in a

separate rulemaking considering all product categories.

V. Analytical Results and Conclusions

The following section addresses the results from DOE’s analyses with respect to

the considered energy conservation standards for consumer clothes dryers. It addresses

the TSLs examined by DOE, the projected impacts of each of these levels if adopted as

energy conservation standards for consumer clothes dryers, and the standards levels that

DOE is adopting in this direct final rule. Additional details regarding DOE’s analyses are

contained in the direct final rule TSD supporting this document.

A. Trial Standard Levels

In general, DOE typically evaluates potential amended standards for products and

equipment by grouping individual efficiency levels for each class into TSLs. Use of

TSLs allows DOE to identify and consider manufacturer cost interactions between the

product classes, to the extent that there are such interactions, and market cross elasticity

from consumer purchasing decisions that may change when different standard levels are

set.

175

In the analysis conducted for this direct final rule, DOE analyzed the benefits and

burdens of six TSLs for consumer clothes dryers. DOE developed TSLs that combine

efficiency levels for each analyzed product class/category using similar technologies

and/or efficiencies and having roughly comparable equipment availability. DOE presents

the results for the TSLs in this document, while the results for all efficiency levels that

DOE analyzed are in the direct final rule TSD. DOE presents the results for the TSLs in

this document, while the results for all efficiency levels that DOE analyzed are in the

direct final rule TSD.

Table V.1 presents the TSLs and the corresponding efficiency levels that DOE

has identified for potential amended energy conservation standards for consumer clothes

dryers. For the vented gas compact product class, all TSLs represent the baseline

efficiency level because there are no higher efficiency levels, and this level corresponds

to the efficiency level for vented gas compact clothes dryers in the Recommended TSL in

the Joint Agreement. For all remaining product classes, the TSLs are defined as follows.

TSL 6 represents the maximum technologically feasible (“max-tech”) energy efficiency.

TSL 5 represents the maximum national energy savings with maximum positive NPV.

TSL 4 represents the maximum national energy savings with simple PBP less than 4

years. TSL 3—which corresponds to the Recommended TSL in the Joint Agreement—

represents the intermediate efficiency level between TSL 2 and TSL 4. TSL 2

corresponds to the efficiency level with high-speed spin for ventless electric combination

washer-dryer and automatic termination control system for all other product classes. TSL

1 corresponds to the efficiency level with electronic controls.

176

Table V.1 Trial Standard Levels for Consumer Clothes Dryers

Product

Class

TSL 1

TSL 2

TSL 3

TSL 4

TSL 5

TSL 6

Efficiency Level and Representative CEF

(lb/kWh)

Electric,

Standard

(2.68)

(3.27)

(3.93)

(4.21)

(7.39)

Electric,

Compact

(120V)

(3.15)

(4.28)

(4.33)

(6.37)

Vented

Electric,

Compact

(240V)

(2.44)

(3.30)

(3.57)

(3.82)

(3.91)

Vented Gas,

Standard

(2.44)

(3.00)

(3.48)

(3.83)

Vented Gas,

Compact

Baseline

(2.02)

Baseline

(2.02)

Baseline

(2.02)

Baseline

(2.02)

Baseline

(2.02)

Baseline

(2.02)

Ventless

Electric,

Compact

(240V)

Baseline

(2.03)

(2.68)

(6.80)

Ventless

Electric,

Combination

Washer-

Dryer

Baseline

(2.27)

(2.33)

(4.01)

DOE constructed the TSLs for this direct final rule to include efficiency levels

(“ELs”) representative of ELs with similar characteristics (i.e., using similar technologies

and/or efficiencies, and having roughly comparable equipment availability). The use of

representative ELs provided for greater distinction between the TSLs. While

representative ELs were included in the TSLs, DOE considered all ELs as part of its

analysis but did not include all ELs in the TSLs.

113

Efficiency levels that were analyzed for this final rule are discussed in section IV.C.1 of this document.

Results by efficiency level are presented in the final rule TSD chapters 8 and 10.

177

B. Economic Justification and Energy Savings

1. Economic Impacts on Individual Consumers

DOE analyzed the economic impacts on consumers of consumer clothes dryers by

looking at the effects that potential amended standards at each TSL would have on the

LCC and PBP. DOE also examined the impacts of potential standards on selected

consumer subgroups. These analyses are discussed in the following sections.

a. Life-Cycle Cost and Payback Period

In general, higher efficiency products affect consumers in two ways: (1) purchase

price increases and (2) annual operating costs decrease. Inputs used for calculating the

LCC and PBP include total installed costs (i.e., product price plus installation costs) and

operating costs (i.e., annual energy use, energy prices, energy price trends, repair costs,

and maintenance costs). The LCC calculation also uses product lifetime and a discount

rate. Chapter 8 of the direct final rule TSD provides detailed information on the LCC and

PBP analyses.

Table V.2 through Table V.13 show the LCC and PBP results for the TSLs

considered for each product class. In the first of each pair of tables, the simple payback

is measured relative to the baseline product. In the second table, the impacts are

measured relative to the efficiency distribution in the in the no-new-standards case in the

compliance year (see section IV.F.8 of this document). Because some consumers

purchase products with higher efficiency in the no-new-standards case, the average

savings are less than the difference between the average LCC of the baseline product and

the average LCC at each TSL. The savings refer only to consumers who are affected by a

178

standard at a given TSL. Those who already purchase a product with efficiency at or

above a given TSL are not affected. Consumers for whom the LCC increases at a given

TSL experience a net cost.

Table V.2 Average LCC and PBP Results for Electric Standard Consumer Clothes

Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Average Costs

2022$

Simple

Payback

Period

years

Average

Lifetime

years

Installed

Cost

First

Year’s

Operating

Cost

Lifetime

Operating

Cost

LCC

2.20

Baseline

$656

$111

$1,251

$1,907

2.68

$666

$94

$1,082

$1,748

0.5

3.27

$672

$79

$922

$1,594

0.5

3* 3.93 4 $678 $67 $802 $1,480 0.6 14

4.21

$756

$64

$759

$1,515

2.1

5, 6

7.39

$1,055

$42

$514

$1,569

5.8

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The

PBP is measured relative to the baseline product.

* All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.3 Average LCC Savings Relative to the No-New-Standards Case for

Electric Standard Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Life-Cycle Cost Savings

Average LCC Savings

2022$

Percentage of Consumers That

Experience Net Cost

2.68

$150

1.2%

3.27

$170

0.9%

3**

3.93

$252

0.9%

4.21

$100

48.0%

5, 6

7.39

$41

63.1%

* The savings represent the average LCC for affected consumers.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.4 Average LCC and PBP Results for Electric Compact (120V) Consumer

Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Average Costs

2022$

Simple

Payback

Period

years

Average

Lifetime

years

Installed

Cost

First

Year’s

Operating

Cost

Lifetime

Operatin

g Cost

LCC

179

2.36

Baseline

$683

$40

$325

$1,136

3.15

$695

$32

$257

$1,082

1.5

4.28

$704

$25

$199

$1,017

1.5

4.33

$712

$25

$198

$1,023

2.2

4, 5

4.33

$715

$25

$198

$1,026

2.2

6.37

$1,057

$19

$146

$1,301

18.1

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The

PBP is measured relative to the baseline product.

* All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.5 Average LCC Savings Relative to the No-New-Standards Case for

Electric Compact (120V) Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Life-Cycle Cost Savings

Average LCC Savings

2022$

Percentage of Consumers That

Experience Net Cost

3.15

$53

4.8%

4.28

$83

5.1%

3**

4.33

$66

21.4%

4, 5

4.33

$66

21.7%

6.37

($209)

90.9%

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.6 Average LCC and PBP Results for Vented Electric Compact (240V)

Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Average Costs

2022$

Simple

Payback

years

Average

Lifetime

years

Installed

Cost

First Year’s

Operating

Cost

Lifetime

Operating

Cost

LCC

2.00

Baseline

$685

$47

$541

$1,226

2.44

$698

$41

$490

$1,187

2.1

3.30

$707

$32

$394

$1,101

1.5

3.57

$714

$30

$375

$1,090

2.0

3.57

$718

$30

$374

$1,092

2.0

3.82

$802

$29

$357

$1,160

6.6

3.91

$1,059

$29

$352

$1,412

20.4

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The

PBP is measured relative to the baseline product.

* All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

180

Table V.7 Average LCC Savings Relative to the No-New-Standards Case for Vented

Electric Compact (240V) Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Life-Cycle Cost Savings

Average LCC Savings

2022$

Percent of Consumers that

Experience Net Cost

2.44

$38

5.7%

3.30

$89

4.6%

3**

3.57

$90

12.4%

3.57

$90

12.6%

3.82

$22

60.7%

3.91

($230)

92.8%

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.8 Average LCC and PBP Results for Vented Gas Standard Consumer

Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Average Costs

2022$

Simple

Payback

Period

years

Average

Lifetime

years

Installed

Cost

First

Year’s

Operating

Cost

Lifetime

Operating

Cost

LCC

2.00

Baseline

$794

$56

$668

$1,461

2.44

$810

$50

$607

$1,417

2.5

3.00

$813

$41

$511

$1,324

1.3

3.48

$825

$36

$465

$1,291

1.9

3.48

$830

$37

$464

$1,293

1.9

5, 6

3.83

$904

$34

$429

$1,333

5.0

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The

PBP is measured relative to the baseline product.

* All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.9 Average LCC Savings Relative to the No-New-Standards Case for Vented

Gas Standard Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Life-Cycle Cost Savings

Average LCC Savings

2022$

Percentage of Consumers That

Experience Net Cost

2.44

$48

2.7%

3.00

$112

1.7%

3**

3.48

$102

7.1%

3.48

$102

7.0%

5, 6

3.83

$13

68.7%

* The savings represent the average LCC for affected consumers.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

181

Table V.10 Average LCC and PBP Results for Ventless Electric Compact (240V)

Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Average Costs

2022$

Simple

Payback

years

Average

Lifetime

years

Installed

Cost

First

Year’s

Operating

Cost

Lifetime

Operating

Cost

LCC

2.03

Baseline

$1,020

$41

$475

$1,495

2.03

Baseline

$1,020

$41

$475

$1,495

2, 4,

2.68 1 $1,024 $31 $368 $1,392 0.4 14

2.68

$1,018

$30

$370

$1,387

0.4

6.80

$1,346

$12

$167

$1,513

11.4

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The

PBP is measured relative to the baseline product.

* All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.11 Average LCC Savings Relative to the No-New-Standards Case for

Ventless Electric Compact (240V) Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Life-Cycle Cost Savings

Average LCC Savings

2022$

Percent of Consumers that

Experience Net Cost

2.03

Baseline

4, 5

2.68 1 $99 0.0%

3**

2.68

$99

0.0%

6.80

($102)

58.6%

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.12 Average LCC and PBP Results for Ventless Electric Combination

Washer-Dryer Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Average Costs

2022$

Simple

Paybac

Period

years

Average

Lifetime

years

Installe

d Cost

First

Year’s

Operating

Cost

Lifetime

Operating

Cost

LCC

2.27

Baseline

$1,335

$37

$445

$1,780

2, 4,

2.33 1 $1,335 $36 $435 $1,769 0.0 14

2.33

$1,327

$36

$436

$1,763

0.0

4.01

$2,031

$22

$275

$2,305

46.3

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The

PBP is measured relative to the baseline product.

182

* All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.13 Average LCC Savings Relative to the No-New-Standards Case for

Ventless Electric Combination Washer-Dryer Consumer Clothes Dryers

TSL

CEF

(lb/kWh)

Efficiency

Level

Life-Cycle Cost Savings

Average LCC Savings

2022$

Percent of Consumers that

Experience Net Cost

2.27

Baseline

2, 4, 5

2.33

$10

0.0%

3**

2.33

$11

0.0%

4.01

($531)

95.0%

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

b. Consumer Subgroup Analysis

In the consumer subgroup analysis, DOE estimated the impact of the considered

TSLs on low-income households and senior-only households. Table V.14 through Table

V.25 compare the average LCC savings, PBP, percent of consumers negatively impacted,

and percent of consumers positively impacted at each EL for the consumer subgroups,

along with corresponding values for the entire residential consumer sample for product

classes with a sufficient sample size. In most cases, the average LCC savings and PBP

for low-income households and senior-only households at the considered ELs are not

substantially different from the average for all households. Chapter 11 of the direct final

rule TSD presents the complete LCC and PBP results for the subgroups.

183

Table V.14 Comparison of LCC Savings and PBP for Consumer Subgroups and All

Households: Electric Standard Consumer Clothes Dryers

Average Life-Cycle Cost Savings*

2022$

Simple Payback Period

years

EL TSL

Low-Income

Households

Senior-Only

Households

All

Households

Low-

Income

Households

Senior-Only

Households

All

Households

$148

$110

$150

0.3

0.7

0.5

$166

$128

$170

0.3

0.6

0.5

3**

$245

$190

$252

0.3

0.8

0.6

$127

$58

$100

1.1

2.8

2.1

5, 6

$180

($56)

$41

3.2

7.6

5.8

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.15 Comparison of Percentages of Impacted Consumers* for Consumer

Subgroups and All Households: Electric Standard Consumer Clothes Dryers

EL TSL

Low-Income

Households

Senior-Only

Households

All Households

1.3%

1.4%

1.2%

1.0%

1.1%

0.9%

3**

0.8%

1.1%

0.9%

26.6%

53.6%

48.0%

5, 6

34.9%

71.6%

63.1%

* Percentage of impacted consumers indicates households with net cost.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.16 Comparison of LCC Savings and PBP for Consumer Subgroups and All

Households: Electric Compact (120V) Consumer Clothes Dryers

Average Life-Cycle Cost Savings

2022$

Simple Payback Period

years

TSL

Low-Income

Households

Senior-Only

Households

All

Households

Low-

Income

Households

Senior-Only

Households

All

Households

$67

$34

$53

0.7

2.1

1.5

$96

$61

$83

0.7

1.9

1.5

3**

$84

$46

$66

1.0

2.9

2.2

4, 5

$83

$46

$66

1.0

2.9

2.2

($23)

($243)

($209)

8.5

23.4

18.1

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

184

Table V.17 Comparison of Percentages of Impacted Consumers* for Consumer

Subgroups and All Households: Electric Compact (120V) Consumer Clothes Dryers

EL TSL

Low-Income

Households

Senior-Only

Households

All Households

4.0%

5.0%

4.8%

3.8%

5.6%

5.1%

3**

12.2%

24.8%

21.4%

4, 5

12.2%

25.0%

21.7%

43.9%

94.9%

90.9%

* Percentage of impacted consumers indicates households with net cost.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.18 Comparison of LCC Savings and PBP for Consumer Subgroups and All

Households: Vented Electric Compact (240V) Consumer Clothes Dryers

Average Life-Cycle Cost Savings

2022$

Simple Payback Period

years

EL TSL

Low-Income

Households

Senior-Only

Households

All

Households

Low-

Income

Households

Senior-Only

Households

All

Households

$51

$22

$38

1.0

2.8

2.1

$102

$66

$89

0.7

2.0

1.5

3**

$109

$65

$90

1.0

2.6

2.0

$109

$64

$90

1.0

2.6

2.0

$83

($7)

$22

3.1

8.5

6.6

($45)

($260)

($230)

9.6

26.5

20.4

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

**All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.19 Comparison of Percent of Impacted Consumers* for Consumer

Subgroups and All Households: Vented Electric Compact (240V) Consumer Clothes

Dryers

EL TSL

Low-Income

Households

Senior-Only

Households

All Households

4.5%

6.0%

5.7%

3.7%

5.0%

4.6%

3**

7.4%

15.1%

12.4%

7.5%

15.3%

12.6%

30.0%

68.5%

60.7%

44.9%

96.1%

92.8%

* Percent of impacted consumers indicates households with net cost.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

185

Table V.20 Comparison of LCC Savings and PBP for Consumer Subgroups and All

Households: Vented Gas Standard Consumer Clothes Dryers

Average Life-Cycle Cost Savings

2022$

Simple Payback Period

years

EL TSL

Low-Income

Households

Senior-Only

Households

All

Households

Low-

Income

Households

Senior-Only

Households

All

Households

$57

$33

$48

1.3

3.3

2.5

$117

$91

$112

0.7

1.6

1.3

3**

$113

$81

$102

1.0

2.4

1.9

$113

$81

$102

1.0

2.4

1.9

5, 6

$54

($5)

$13

2.7

6.3

5.0

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.21 Comparison of Percentages of Impacted Consumers* for Consumer

Subgroups and All Households: Vented Gas Standard Consumer Clothes Dryers

EL TSL

Low-Income

Households

Senior-Only Households All Households

2.4%

3.0%

2.7%

1.6%

1.7%

3**

4.8%

8.9%

7.1%

3, 4

4.8%

8.8%

7.0%

5, 6

35.9%

74.5%

68.7%

* Percentage of impacted consumers indicates households with net cost.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.22 Comparison of LCC Savings and PBP for Consumer Subgroups and All

Households: Ventless Electric Compact (240V) Consumer Clothes Dryers

Average Life-Cycle Cost Savings

2022$

Simple Payback Period

years

TSL

Low-Income

Households

Senior-Only

Households

All

Households

Low-

Income

Households

Senior-Only

Households

All

Households

2, 4,

$108 $80 $99 0.2 0.5 0.4

1 3** $108 $80 $99 0.2 0.5 0.4

$64

($147)

($102)

5.4

14.5

11.4

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

186

Table V.23 Comparison of Percent of Impacted Consumers* for Consumer

Subgroups and All Households: Ventless Electric Compact (240V) Consumer

Clothes Dryers

EL TSL

Low-Income

Households

Senior-Only

Households

All Households

2, 4, 5

0.0%

3**

0.0%

27.8%

63.4%

58.6%

* Percentage of impacted consumers indicates households with net cost.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.24 Comparison of LCC Savings and PBP for Consumer Subgroups and All

Households: Ventless Electric Combination Washer-Dryer Consumer Clothes

Dryers

Average Life-Cycle Cost Savings

2022$

Simple Payback Period

years

EL TSL

Low-Income

Households

Senior-Only

Households

All

Households

Low-Income

Households

Senior-Only

Households

All

Households

2, 4,

$11 $8 $10 0.0 0.0 0.0

1 3** $11 $8 $11 0.0 0.0 0.0

($186)

($565)

($531)

22.0

58.6

46.3

* The savings represent the average LCC for affected consumers. Negative values are denoted in parentheses.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

Table V.25 Comparison of Percentages of Impacted Consumers* for Consumer

Subgroups and All Households: Ventless Electric Combination Washer-Dryer

Consumer Clothes Dryers

EL TSL

Low-Income

Households

Senior-Only

Households

All Households

2, 4, 5

0.0%

3**

0.0%

44.8%

96.2%

95.0%

* Percentage of impacted consumers indicates households with net cost.

** All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

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c. Rebuttable Presumption Payback

As discussed in section II.A of this document, EPCA establishes a rebuttable

presumption that an energy conservation standard is economically justified if the

increased purchase cost for a product that meets the standard is less than three times the

value of the first-year energy savings resulting from the standard. In calculating a

rebuttable presumption payback period for each of the considered TSLs, DOE used

discrete values, and, as required by EPCA, based the energy use calculation on the DOE

test procedures for consumer clothes dryers. In contrast, the PBPs presented in section

V.B.1.a of this document were calculated using distributions that reflect the range of

energy use in the field.

Table V.26 presents the rebuttable presumption payback periods for the

considered TSLs for consumer clothes dryers. While DOE examined the rebuttable

presumption criterion, it considered whether the standard levels considered for this rule

are economically justified through a more detailed analysis of the economic impacts of

those levels, pursuant to 42 U.S.C. 6295(o)(2)(B)(i), that considers the full range of

impacts to the consumer, manufacturer, Nation, and environment. The results of that

analysis serve as the basis for DOE to definitively evaluate the economic justification for

a potential standard level, thereby supporting or rebutting the results of any preliminary

determination of economic justification.

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Table V.26 Rebuttable Presumption Payback Periods

Product Class

Trial Standard Level

years

Electric, Standard

0.4

0.3

0.4

1.5

4.1

Electric, Compact (120 V)

1.0

1.6

13.0

Vented Electric, Compact (240 V)

3.2

1.0

1.4

4.6

14.2

Vented Gas, Standard

3.1

2.0

2.9

2.8

7.8

Ventless Electric, Compact (240 V)

0.3

8.8

Ventless Electric, Combination Washer-Dryer

0.0

33.8

* All TSLs except TSL 3 (the Recommended TSL) have a compliance year of 2027. TSL 3 has a compliance year of

2028.

2. Economic Impacts on Manufacturers

DOE performed an MIA to estimate the impact of amended energy conservation

standards on manufacturers of consumer clothes dryers. The next section describes the

expected impacts on manufacturers at each considered TSL. Chapter 12 of the direct

final rule TSD explains the analysis in further detail.

a. Industry Cash Flow Analysis Results

In this section, DOE provides GRIM results from the analysis, which examines

changes in the industry that would result from a standard. The following tables

summarize the estimated financial impacts (represented by changes in INPV) of potential

amended energy conservation standards on manufacturers of consumer clothes dryers, as

well as the conversion costs that DOE estimates manufacturers of consumer clothes

dryers would incur at each TSL.

The impacts of potential amended energy conservation standards were analyzed

under two scenarios: (1) the preservation of gross margin percentage; and (2) the

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preservation of operating profit as discussed in section IV.J.2.d of this document. In the

preservation-of-gross-margin-percentage scenario, DOE applied a gross margin

percentage of 21 percent for all product classes and all efficiency levels in the standards

case.

114

This scenario assumes that a manufacturer’s per-unit dollar profit would increase

as MPCs increase in the standards cases. DOE models this scenario as an upper bound to

industry profitability under an energy conservation standard.

In the preservation-of-operating-profit scenario, manufacturers do not earn

additional operating profit when compared to the no-new-standards case scenario. While

manufacturers make the necessary upfront investments required to produce compliant

products, per-unit operating profit does not change in absolute dollars. DOE models this

scenario as the lower bound to industry profitability under an energy conservation

standard.

Each of the modeled scenarios results in a unique set of cash flows and

corresponding INPV for each TSL. INPV is the sum of the discounted cash flows to the

industry from the base year through the end of the analysis period (30 years from the

analyzed compliance year).

115

The “change in INPV” results refer to the difference in

industry value between the no-new-standards case and standards case at each TSL. To

provide perspective on the short-run cash-flow impact, DOE includes a comparison of

free cash flow between the no-new-standards case and the standards case at each TSL in

114

The gross margin percentage of 21 percent is based on a manufacturer markup of 1.26.

115

The analysis period ranges from 2024–2056 for the no-new-standards case and all TSLs, except for TSL

3 (the Recommended TSL). The analysis period for TSL 3 ranges from 2024–2057 due to the 2028

compliance year.

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the year before amended standards would take effect. This figure provides an

understanding of the magnitude of the required conversion costs relative to the cash flow

generated by the industry in the no-new-standards case.

Conversion costs are one-time investments for manufacturers to bring their

manufacturing facilities and product designs into compliance with potential amended

standards. As described in section IV.J.2.c of this document, conversion cost investments

occur between the year of publication of the direct final rule and the year by which

manufacturers must comply with the new standard. The conversion costs can have a

significant impact on short-term cash flow within the industry and generally result in

lower free cash flow in the period between publication of the direct final rule and the

compliance date of potential amended standards. Conversion costs are independent of the

manufacturer markup scenarios and are not presented as a range in this analysis.

Table V.27 Manufacturer Impact Analysis Results for Consumer Clothes Dryers

Units

No-New-

Standard

s Case

TSL 1

TSL 2

TSL 3

TSL 4

TSL 5

TSL 6

INPV

2022$

millions

2,115.4

2,080.3 to

2,084.3

2,061.1 to

2,069.5

1,971.2 to

1,995.8

1,501.9 to

1,724.8

679.9 to

1,800.8

604.3 to

1,753.5

Change in

INPV*

% -

(1.7) to

(1.5)

(2.6) to

(2.2)

(6.8) to

(5.7)

(29.0) to

(18.5)

(67.9) to

(14.9)

(71.4) to

(17.1)

Free Cash Flow

(2026)**

2022$

millions

136.7*** 119.2 109.7 61.2 (153.7) (496.0) (531.4)

Change in Free

Cash Flow

(2026)**

(12.8)

(19.8)

(55.2)

(212.5)

(462.9)

(488.8)

Product

Conversion

Costs

2022$

millions

27.3

37.6

51.7

87.7

122.6

128.2

Capital

Conversion

Costs

2022$

millions

18.6

31.9

128.9

579.7

1,314.3

1,388.8

Total

Conversion

Costs

2022$

millions

- 45.8 69.5 180.7 667.5 1,436.9 1,516.9

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* Parentheses denote negative values.

**TSL 3 (the Recommended TSL) represents the change in free cash flow in 2027, a year before the 2028

compliance date.

*** In 2027, the no-new-standards free cash flow is $136.6 million.

The cash flow results discussion below refers to product classes as defined in

Table IV.1 in section IV.A.1 of this document. It also refers to the efficiency levels and

associated design options designated in Table IV.5 through Table IV.10 in section

IV.C.1.b of this document.

At TSL 1, the standard reflects efficiency levels with electronic controls for all

product classes. The change in INPV is expected to range from -1.7 to -1.5 percent. At

this level, free cash flow is estimated to decrease by 12.8 percent compared to the no-

new-standards case value of $136.7 million in the year 2026, the year before the 2027

standards year. DOE’s shipments analysis estimates approximately 85 percent of current

shipments meet this level.

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The design options DOE analyzed include implementing electronic controls. For

electric standard, electric compact (120V), vented electric compact (240V), and vented

gas standard, TSL 1 corresponds to EL 1. For ventless electric compact (240V) and

ventless electric combination washer-dryer, TSL 1 corresponds to the baseline CEF

Capital conversion costs may be necessary for additional tooling for timers and

electronics. Product conversion costs may be necessary for developing, sourcing, and

testing electronics (e.g., safety, performance, and durability tests). DOE does not expect

industry to incur re-flooring costs at this level since the necessary enhancements could be

116

Current shipments calculations relied on shipments in 2024 (the reference year).

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done “behind the hinge,” incorporating the design changes in a manner that does not

impact product appearance. DOE does not expect industry to incur conversion costs

related to the ventless electric compact (240V) or ventless electric combination washer-

dryer as the efficiency levels would remain at baseline. DOE estimates capital conversion

costs of $18.6 million and product conversion costs of $27.3 million. Conversion costs

total $45.8 million.

At TSL 1, the shipment-weighted average MPC for all consumer clothes dryers is

expected to increase by 0.3 percent relative to the no-new-standards case shipment-

weighted average MPC for all consumer clothes dryers in 2027. Given this relatively

small increase in production costs, DOE does not project a notable drop in shipments in

the year the standard takes effect. In the preservation-of-gross-margin-percentage

scenario, the slight increase in cash flow from the higher MSP is outweighed by the $45.8

million in conversion costs, causing a slightly negative change in INPV at TSL 1 under

this scenario. Under the preservation-of-operating-profit scenario, manufacturers earn

the same per-unit operating profit as would be earned in the no-new-standards case, but

manufacturers do not earn additional profit from their investments. In this scenario, the

manufacturer markup decreases in 2028, the year after the analyzed 2027 compliance

year. This reduction in the manufacturer markup and the $45.8 million in conversion

costs incurred by manufacturers cause a slightly negative change in INPV at TSL 1 under

the preservation-of-operating-profit scenario.

At TSL 2, the standard reflects efficiency levels with more advanced automatic

termination controls for electric standard, electric compact (120V), vented electric

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compact (240V), vented gas standard, and ventless electric compact (240V), and high-

speed spin for ventless electric combination washer-dryer. The change in INPV is

expected to range from -2.6 to -2.2 percent. At this level, free cash flow is estimated to

decrease 19.8 percent compared to the no-new-standards case value of $136.7 million in

the year 2026, the year before the 2027 standards year. DOE’s shipments analysis

estimates approximately 58 percent of current shipments meet this level.

The design options for electric standard, electric compact (120V), vented electric

compact (240V), vented gas standard, and ventless electric compact (240V) include

implementing electronic controls, optimized heating systems, and more advanced

automatic termination controls. For ventless electric combination washer-dryer, the

design option analyzed includes high-speed spin cycles. For the electric standard, electric

compact (120V), and vented electric compact (240V), TSL 2 corresponds to EL 3. For

vented gas standard, TSL 2 corresponds to EL 2. For ventless electric compact (240V)

and ventless electric combination washer-dryer, TSL 2 corresponds to EL 1. Capital

conversion costs may be necessary for incremental updates in tooling. Product

conversion costs may be necessary for software optimization, prototyping, and testing.

DOE expects industry to incur some re-flooring costs as manufacturers redesign product

lines to meet the efficiency levels required by TSL 2. DOE estimates capital conversion

costs of $31.9 million and product conversion costs of $37.6 million. Conversion costs

total $69.5 million.

At TSL 2, the shipment-weighted average MPC for all consumer clothes dryers is

expected to increase by 0.6 percent relative to the no-new-standards case shipment-

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weighted average MPC for all consumer clothes dryers in 2027. Given the relatively

small increase in production costs, DOE does not project a notable drop in shipments in

the year the standard takes effect. In the preservation-of-gross-margin-percentage

scenario, the slight increase cash flow from the higher MSP is outweighed by the $69.5

million in conversion costs, causing a slightly negative change in INPV at TSL 2 under

this scenario. Under the preservation-of-operating-profit scenario, the manufacturer

markup decreases in 2028, the year after the analyzed 2027 compliance year. This

reduction in the manufacturer markup and the $69.5 million in conversion costs incurred

by manufacturers cause a negative change in INPV at TSL 2 under the preservation-of-

operating-profit scenario.

At TSL 3 (i.e., the Recommended TSL), the standard reflects a set of efficiency

levels between the levels designated in TSL 2 and TSL 4. The change in INPV is

expected to range from -6.8 to -5.7 percent. At this level, free cash flow is estimated to

decrease 55.2 percent compared to the no-new-standards case value of $136.6 million in

the year 2027, the year before the 2028 standards year. DOE’s shipments analysis

estimates approximately 48 percent of current shipments meet this level.

The design options analyzed for electric standard, electric compact (120V),

vented electric compact (240V), and vented gas standard include implementing electronic

controls, optimized heating systems, more advanced automatic termination controls, and

modulating heat. For ventless electric compact (240V) and ventless electric combination

washer-dryer, the design options analyzed are the same as TSL 2. For electric standard,

electric compact (120V), and vented electric compact (240V), TSL 3 corresponds to EL

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4. For vented gas standard, TSL 3 corresponds to EL 3. For ventless electric compact

(240V) and ventless electric combination washer-dryer, TSL 3 corresponds to EL 1. The

incremental increase in industry conversion costs from the prior TSL are due to the

higher efficiency level requirements for electric standard, electric compact (120V),

vented electric compact (240V), and vented gas standard. Capital conversion costs may

be necessary as manufacturers increase tooling for two-stage heating systems. Product

conversion costs may be necessary for prototyping and testing. DOE expects industry to

incur similar re-flooring costs as with TSL 2. DOE estimates capital conversion costs of

$128.9 million and product conversion costs of $51.7 million. Conversion costs total

$180.7 million.

At TSL 3, the shipment-weighted average MPC for all consumer clothes dryers is

expected to increase by 1.7 percent relative to the no-new-standards case shipment-

weighted average MPC for all consumer clothes dryers in 2028. Given the relatively

small increase in production costs, DOE does not project a notable drop in shipments in

the year the standard takes effect. In the preservation-of-gross-margin-percentage

scenario, the increase in cash flow from the higher MSP is outweighed by the $180.7

million in conversion costs, causing a negative change in INPV at TSL 3 under this

scenario. Under the preservation-of-operating-profit scenario, the manufacturer markup

decreases in 2029, the year after the analyzed 2028 compliance year. This reduction in

the manufacturer markup and the $180.7 million in conversion costs incurred by

manufacturers cause a negative change in INPV at TSL 3 under the preservation-of-

operating-profit scenario.

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At TSL 4, the standard reflects the maximum national energy savings with a

simple PBP of less than 4 years. The change in INPV is expected to range from -29.0 to -

18.5 percent. At this level, free cash flow is estimated to decrease by 212.5 percent

compared to the no-new-standards case value of $136.7 million in the year 2026, the year

before the 2027 standards year. DOE’s shipments analysis estimates approximately 15

percent of current shipments meet this level.

The design options analyzed for electric standard include implementing electronic

controls, optimized heating systems, more advanced automatic termination controls,

modulating heat, and inlet air preheat. For the remaining product classes, the efficiency

levels and analyzed design options for TSL 4 are the same as TSL 3. The incremental

increase in industry conversion costs from the prior TSL is due to the efficiency level

requirements for electric standard. There is very little industry experience with inlet air

preheat designs. Currently, DOE is not aware of any consumer clothes dryers on the

market utilizing this design option. Electric standard dryers account for an estimated 81

percent of domestic consumer clothes dryer shipments. Of these standard electric dryer

shipments, DOE estimates only 7 percent meet or exceed the efficiency level required by

TSL 4. Implementing inlet air preheat represents a major overhaul of existing product

lines and manufacturing facilities. For capital conversion costs, this change might

necessitate significant new equipment and tooling. Product conversion costs may be

necessary for designing, prototyping, and testing new or updated platforms. DOE

expects industry to incur more re-flooring costs compared to prior TSLs as more display

units would need to be replaced with high-efficiency models. DOE estimates capital

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conversion costs of $579.7 million and product conversion costs of $87.7 million.

Conversion costs total $667.5 million.

At TSL 4, the large conversion costs result in free cash flow dropping below zero

in the years before the standards year. The negative free cash-flow calculation indicates

manufacturers may need to access cash reserves or outside capital to finance conversion

efforts.

At this level, the shipment-weighted average MPC for all consumer clothes dryers

is expected to increase by 13 percent relative to the no-new-standards case shipment-

weighted average MPC for all consumer clothes dryers in 2027. Given the projected

increase in production costs, DOE estimates a less than 1-percent drop in shipments in

the year the standard takes effect compared to the no-new-standards case. In the

preservation-of-gross-margin-percentage scenario, the increase in cash flow from the

higher MSP is outweighed by the $667.5 million in conversion costs, causing a negative

change in INPV at TSL 4 under this scenario. Under the preservation-of-operating-profit

scenario, the manufacturer markup decreases in 2028, the year after the analyzed 2027

compliance year. This reduction in the manufacturer markup and the $667.5 million in

conversion costs incurred by manufacturers cause a negative change in INPV at TSL 4

under the preservation-of-operating-profit scenario.

At TSL 5, the standard reflects the maximum national energy savings with

maximum positive NPV. The change in INPV is expected to range from -67.9 to -14.9

percent. At this level, free cash flow is estimated to decrease by 462.9 percent compared

198

to the no-new-standards case value of $136.7 million in the year 2026, the year before the

2027 standards year. DOE’s shipments analysis estimates approximately 2 percent of

current shipments meet this level.

The design option analyzed for electric standard includes implementing heat

pump technology. The design options analyzed for the vented electric compact (240V)

and vented gas standard include implementing electronic controls, optimized heating

systems, more advanced automatic termination controls, modulating heat, and inlet air

preheat. For electric compact (120V), ventless electric compact (240V), and ventless

electric combination washer-dryer, the design options analyzed are the same as the prior

TSL. For electric standard, TSL 5 corresponds to EL 7. For electric compact (120V) and

vented gas standard, TSL 5 corresponds to EL 4. For vented electric compact (240V),

TSL 5 corresponds to EL 5. For ventless electric compact (240V) and ventless electric

combination washer-dryer, TSL 5 corresponds to EL 1.

At TSL 5, conversion costs are largely driven by the max-tech efficiency level

required for electric standard and vented gas standard. As previously discussed, electric

standard dryers account for 81 percent of domestic consumer clothes dryer shipments.

Currently, there are few electric standard models on the U.S. market that meet the max-

tech efficiency level required by TSL 5. Of the 13 OEMs identified that offer electric

standard dryers, only five OEMs manufacture electric standard dryers that utilize heat

pump technology. Of these five OEMs, four OEMs offer approximately six models

(accounting for less than 1 percent of electric standard model listings) that meet the max-

tech level required at TSL 5. Nearly all manufacturers would need to significantly update

199

facilities to meet a heat pump efficiency level for electric standard dryers. Mandating a

heat pump efficiency level for this product class would require many manufacturers to

design completely new clothes dryer platforms or adapt heat pump designs from other

markets (i.e., redesign European heat pump models to adhere to U.S. safety standards and

consumer preferences).

Vented gas standard dryers account for approximately 17 percent of domestic

consumer clothes dryer shipments. Manufacturers would need to implement inlet air

preheat technology along with other design options to meet the efficiency levels required

by TSL 5. Thus far, dryers with this technology and performance have not been observed

in clothes dryers available on the consumer market. Clothes dryers with inlet air preheat

designs have been observed only in laboratory settings. In interviews, some

manufacturers raised concerns about implementing a relatively untested technology for

the consumer market. There is very little industry experience with inlet air preheat

designs. Several manufacturers speculated that implementing inlet air preheat technology

would require a major overhaul of existing production facilities and a significant amount

of engineering time.

DOE expects industry to incur more re-flooring costs compared to prior TSLs, as

nearly all display units would need to be replaced with high-efficiency models. DOE

estimates capital conversion costs of $1,314.3 million and product conversion costs of

$122.6 million. Conversion costs total $1,436.9 million.

200

As with TSL 4, the large conversion costs result in free cash flow dropping below

zero in the years before the standard year. The negative free cash-flow calculation

indicates manufacturers may need to access cash reserves or outside capital to finance

conversion efforts.

At this level, the shipment-weighted average MPC for all consumer clothes dryers

is expected to increase by 63.2 percent relative to the no-new-standards case shipment-

weighted average MPC for all consumer clothes dryers in 2027. Given the projected

increase in production costs, DOE expects an estimated 11-percent drop in shipments in

the year the standard takes effect compared to the no-new-standards case. In the

preservation-of-gross-margin-percentage scenario, the increase in MSP is outweighed by

the $1,436.9 million in conversion costs and the drop in annual shipments, causing a

negative change in INPV at TSL 5 under this scenario. Under the preservation-of-

operating-profit scenario, the manufacturer markup decreases in 2028, the year after the

analyzed 2027 compliance year. This large reduction in manufacturer markup, the

$1,436.9 million in conversion costs incurred by manufacturers, and the drop in annual

shipments cause a significantly negative change in INPV at TSL 5 under the

preservation-of-operating-profit scenario.

At TSL 6, the standard reflects max-tech efficiency for all product classes. The

change in INPV is expected to range from -71.4 to -17.1 percent. At this level, free cash

flow is estimated to decrease by 488.8 percent compared to the no-new-standards case

value of $136.7 million in the year 2026, the year before the 2027 standards year. DOE’s

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shipments analysis estimates approximately 1 percent of current shipments meet this

level.

The design option analyzed for TSL 6 incorporates heat pump technology for

electric standard, electric compact (120V), vented electric compact (240V), ventless

electric compact (240V), and ventless electric combination washer-dryer. For vented gas

standard, the design options analyzed include implementing electronic controls,

optimized heating systems, more advanced automatic termination controls, modulating

heat, and inlet air preheat.

Of the 19 OEMs that manufacture electric consumer clothes dryers (i.e., electric

standard, electric compact (120V), vented electric compact (240V), ventless electric

compact (240V), ventless electric combination washer-dryer), 10 OEMs do not currently

offer any consumer clothes dryer models for the U.S. market that utilize heat pump

technology. Of the 13 OEMs that offer electric standard clothes dryers, four OEMs

currently offer some models that meet the max-tech heat pump level. Of the 10 OEMs

that offer electric compact (120V) clothes dryers, one OEM offers a model that meets the

max-tech level. Of the five OEMs that offer vented electric compact (240V) clothes

dryers, one OEM offers models that meet the max-tech level. Of the 13 OEMs that offer

ventless electric compact (240V) clothes dryers, one OEM offers a model that meets the

max-tech level. Of the five OEMs that offer ventless electric combination washer-dryer,

two OEMs offer models that meet the max-tech level.

202

A standard that could only be met using heat pump technology could require a

total renovation of existing facilities and completely new clothes dryer platforms for

manufacturers that do not offer heat pump clothes dryers today. In interviews, two

OEMs with significant market shares stated that they would require additional facilities to

handle dryer manufacturing under a standard that could only be met using heat pump

technology. As previously discussed, implementing inlet air preheat also represents a

major overhaul of existing vented gas product lines. DOE expects industry to incur

slightly more re-flooring costs compared to TSL 5, as all display models below max-tech

efficiency would need to be replaced due to the higher standard. At TSL 6, reaching

max-tech efficiency levels is a billion-dollar investment for industry. DOE estimates

capital conversion costs of $1,388.8 million and product conversion costs of $128.2

million. Conversion costs total $1,516.9 million.

As with TSL 4 and TSL 5, the large conversion costs result in free cash flow

dropping below zero in the years before the standard year. The negative free cash-flow

calculation indicates manufacturers may need to access cash reserves or outside capital to

finance conversion efforts.

At this level, the shipment-weighted average MPC for all consumer clothes dryers

is expected to increase by 64.7 percent relative to the no-new-standards case shipment-

weighted average MPC for all consumer clothes dryers in 2027. Given the projected

increase in production costs, DOE expects an estimated 11-percent drop in shipments in

the year the standard takes effect compared to the no-new-standards case. In the

preservation-of-gross-margin-percentage scenario, the large increase in MSP is still

203

outweighed by the $1,516.9 million in conversion costs and drop in annual shipments,

causing a moderately negative change in INPV at TSL 6 under this scenario. Under the

preservation-of-operating-profit scenario, the manufacturer markup decreases in 2028,

the year after the analyzed 2027 compliance year. This large reduction in manufacturer

markup, the $1,516.9 million in conversion costs incurred by manufacturers, and the drop

in annual shipments cause a significantly negative change in INPV at TSL 6 under the

preservation-of-operating-profit scenario.

b. Direct Impacts on Employment

To quantitatively assess the potential impacts of amended energy conservation

standards on direct employment in the consumer clothes dryer industry, DOE used the

GRIM to estimate the domestic labor expenditures and number of direct employees in the

no-new-standards case and in each of the standards cases during the analysis period. For

the direct final rule, DOE used the most up-to-date information available. DOE calculated

these values using statistical data from the U.S. Census Bureau’s 2021 ASM,

117

the U.S.

Bureau of Labor Statistics’ employee compensation data,

118

results of the engineering

analysis, and manufacturer interviews.

Labor expenditures related to product manufacturing depend on the labor intensity

of the product, the sales volume, and an assumption that wages remain fixed in real terms

over time. The total labor expenditures in each year are calculated by multiplying the

117

U.S. Census Bureau, Annual Survey of Manufactures: Summary Statistics for Industry Groups and

Industries in the U.S.: 2018–2021. Available at www.census.gov/programs-surveys/asm/data/tables.html

(last accessed May 23, 2023).

118

U.S. Bureau of Labor Statistics. Employer Costs for Employee Compensation. March 17, 2023.

Available at www.bls.gov/news.release/pdf/ecec.pdf (last accessed June 8, 2023).

204

total MPCs by the labor percentage of MPCs. The total labor expenditures in the GRIM

were then converted to total production employment levels by dividing production labor

expenditures by the average fully burdened wage multiplied by the average number of

hours worked per year per production worker. To do this, DOE relied on ASM inputs:

Production Workers Annual Wages, Production Workers Annual Hours, Production

Workers for Pay Period, and Number of Employees. DOE also relied on BLS employee

compensation data to determine the fully burdened wage ratio. The fully burdened wage

ratio factors in paid leave, supplemental pay, insurance, retirement and savings, and

legally required benefits.

The number of production employees is then multiplied by the U.S. labor

percentage to convert total production employment to total domestic production

employment. The U.S. labor percentage represents the industry fraction of domestic

manufacturing production capacity for the covered product. This value is derived from

manufacturer interviews, product database analysis, and publicly available information.

For the August 2022 NOPR, DOE estimated that approximately 58 percent of consumer

clothes dryers were produced domestically. In support of this direct final rule analysis,

DOE conducted further research to ensure this estimate was still accurate. Based on a

review of publicly available data, DOE estimates that 60 percent of consumer clothes

dryers are produced domestically.

The domestic production employees estimate covers production line workers,

including line supervisors, who are directly involved in fabricating and assembling

products within the OEM facility. Workers performing services that are closely

205

associated with production operations, such as materials-handling tasks using forklifts,

are also included as production labor. DOE’s estimates only account for production

workers who manufacture the specific products covered by this amended rulemaking.

Non-production workers account for the remainder of the direct employment

figure. The non-production employees estimate covers domestic workers who are not

directly involved in the production process, such as sales, engineering, human resources,

and management. Using the amount of domestic production workers calculated above,

non-production domestic employees are extrapolated by multiplying the ratio of non-

production workers in the industry compared to production employees. DOE assumes

that this employee distribution ratio remains constant between the no-new-standards case

and standards cases.

Using the GRIM, DOE estimates that in the absence of new energy conservation

standards, there would be 2,725 domestic production and non-production workers for

consumer clothes dryers in 2027. Table V.28 shows the range of the impacts of energy

conservation standards on U.S. manufacturing employment in the consumer clothes dryer

industry. The following discussion provides a qualitative evaluation of the range of

potential impacts presented in Table V.28.

206

Table V.28 Domestic Direct Employment Impacts for Consumer Clothes Dryer

Manufacturers in the Analyzed Compliance Year

No-New-

Standards

Case

TSL 1

TSL 2

TSL 3

TSL 4

TSL 5

TSL 6

Direct

Employment in

2027*

(Production

Workers + Non-

Production

Workers)

2,725**

2,729

2,752

2,778

3,106

5,687

5,737

Potential

Changes in

Direct

Employment

Workers***

(2,433)

to 4

(2,433)

to 27

(2,433)

to 34

(2,433)

to 381

(2,433)

to 2,962

(2,433)

to 3,012

* TSL 3 (the Recommended TSL) represents the direct employment in 2028.

** In 2028, the no-new-standards case direct employment estimate is 2,744.

*** DOE presents a range of potential employment impacts. Parentheses denote negative values.

The direct employment impacts shown in Table V.29 represent the potential

domestic employment changes that could result following the compliance date for the

consumer clothes dryer product classes in this amended rule. The upper-bound estimate

corresponds to an increase in the number of domestic workers that would result from

amended energy conservation standards if manufacturers continue to produce the same

scope of covered products within the United States after compliance takes effect. The

lower-bound estimate represents the maximum decrease in production workers if

manufacturing moved to lower labor-cost countries. Most manufacturers currently

produce at least a portion of their consumer clothes dryers in countries with lower labor

costs, and an amended standard that necessitates large increases in labor content or large

expenditures to retool facilities could cause manufacturers to reevaluate domestic

production siting options. However, the Recommended TSL (i.e., TSL 3) would likely

not require significant increases in labor content or significant capital investments. As

207

such, DOE expects that the likelihood of changes in production location as a direct result

of amended standards are relatively low.

Additional detail on the analysis of direct employment can be found in chapter 12

of the direct final rule TSD. Additionally, the employment impacts discussed in this

section are independent of the employment impacts from the broader U.S. economy,

which are documented in chapter 16 of the direct final rule TSD.

c. Impacts on Manufacturing Capacity

As discussed in section V.B.2.a of this document, implementing the different

design options analyzed for this direct final rule would require varying levels of resources

and investment. A standard level that would require the use of heat pump technology for

electric dryers and combination washer-dryers would represent the biggest shift in

technology for clothes dryer manufacturing among all the design options considered for

this analysis. Adopting efficiency levels that require heat pump technology would

necessitate very large investments to both redesign products and update production

facilities. Currently, DOE estimates that approximately 1 percent of consumer clothes

dryer shipments meet the analyzed max-tech heat pump efficiency levels. In interviews,

several manufacturers expressed concern that the 3-year EPCA-specified time period

between the announcement of a final rule and the compliance date of the amended energy

conservation standard might be insufficient to design, test, and manufacture the necessary

number of products to meet demand.

208

In interviews, some manufacturers raised concerns about implementing inlet air

preheat designs. Unlike the discussions about heat pump technology, there is very little

industry experience with inlet air preheat designs. Currently, no models on the U.S.

market incorporate this design option. Several manufacturers speculated that

implementing inlet air preheat would require a major overhaul of existing production

facilities and a significant amount of engineering time.

However, because TSL 3 (i.e., the Recommended TSL) would not require heat

pump technology or inlet air preheat designs, DOE does not expect manufacturers to face

long-term capacity constraints due to the standard levels detailed in this direct final rule.

Furthermore, at the Recommended TSL, manufacturers will have a 4-year period

between the announcement of the direct final rule and the compliance date of the

amended energy conservation standards to redesign products to meet the adopted

standard levels.

d. Impacts on Subgroups of Manufacturers

Using average cost assumptions to develop industry cash flow estimates may not

capture the differential impacts among subgroups of manufacturers. Small

manufacturers, niche players, or manufacturers exhibiting a cost structure that differs

substantially from the industry average could be affected disproportionately. DOE

investigated small businesses as a manufacturer subgroup that could be disproportionally

impacted by energy conservation standards and could merit additional analysis. DOE did

not identify any other adversely impacted manufacturer subgroups for this rulemaking

based on the results of the industry characterization.

209

DOE analyzes the impacts on small businesses in a separate analysis for the

standards proposed in the NOPR published elsewhere in this issue of the Federal

on the small business manufacturer subgroup, see chapter 12 of the direct final rule TSD.

e. Cumulative Regulatory Burden

One aspect of assessing manufacturer burden involves looking at the cumulative

impact of multiple DOE standards and the regulatory actions of other Federal agencies

and States that affect the manufacturers of a covered product or equipment. While any

one regulation may not impose a significant burden on manufacturers, the combined

effects of several existing or impending regulations may have serious consequences for

some manufacturers, groups of manufacturers, or an entire industry. Multiple regulations

affecting the same manufacturer can strain profits and lead companies to abandon product

lines or markets with lower expected future returns than competing products. For these

reasons, DOE conducts an analysis of cumulative regulatory burden as part of its

rulemakings pertaining to appliance efficiency.

For the cumulative regulatory burden analysis, DOE examines Federal, product-

specific regulations that could affect consumer clothes dryer manufacturers that take

effect approximately 3 years before or after the 2028 compliance date. This information

is presented in Table V.29.

210

Table V.29 Compliance Dates and Expected Conversion Expenses of Federal

Energy Conservation Standards Affecting Consumer Clothes Dryer Original

Equipment Manufacturers

Federal Energy

Conservation Standard

Number of

OEMs*

Number of

OEMs

Affected by

Today’s Rule**

Approx.

Standards

Compliance

Year

Industry

Conversion

Costs

(Millions)

Industry

Conversion

Costs /

Equipment

Revenue***

Portable Air

Conditioners

85 FR 1378

(January 10, 2020)

2025

$320.9

(2015$)

6.7%

Residential Clothes

Washers

†

88 FR 13520

(March 3, 2023)

2027

$690.8

(2021$)

5.2%

Miscellaneous

Refrigeration Products

†

88 FR 19382

(March 31, 2023)

2029

$126.9

(2021$)

3.1%

Automatic Commercial

Ice Makers

†

88 FR 30508

(May 11, 2023)

2027

$15.9

(2022$)

0.6%

Dishwashers

†

88 FR 32514

(May 19, 2023)

2027

$125.6

(2021$)

2.1%

Refrigerated Bottled or

Canned Beverage

Vending Machines

†

88 FR 33968

(May 25, 2023)

2028

$1.5

(2022$)

0.2%

Room Air Conditioners

88 FR 34298

(May 26, 2023)

2026

$24.8

(2021$)

0.4%

Microwave Ovens

88 FR 39912

(June 20, 2023)

2026

$46.1

(2021$)

0.7%

Consumer Water

Heaters

†

88 FR 49058

(July 28, 2023)

2030

$228.1

(2022$)

1.3%

Commercial Water

Heating Equipment

88 FR 69686

(October 6, 2023)

2026

$42.7

(2022$)

5.3%

Commercial

Refrigerators,

Refrigerator-Freezers,

and Freezers

†

88 FR 70196

(October 10, 2023)

2028

$226.4

(2022$)

1.6%

Dehumidifiers

†

88 FR 76510

(November 6, 2023)

2028

$6.9

(2022$)

0.4%

211

Consumer Furnaces

88 FR 87502 (December

18, 2023)

2029

$162.0

(2022$)

1.8%

Refrigerators, Freezers,

and Refrigerator-

Freezers

89 FR 3026

(January 17, 2024)

2029 and

2030‡

$830.3

(2022$)

1.3%

Consumer Conventional

Cooking Products

89 FR 11434

(February 14, 2024)

2028

$66.7

(2022$)

0.3%

* This column presents the total number of OEMs identified in the energy conservation standard rule that is

contributing to cumulative regulatory burden.

** This column presents the number of OEMs producing consumer clothes dryers that are also listed as

OEMs in the identified energy conservation standard that is contributing to cumulative regulatory burden.

*** This column presents industry conversion costs as a percentage of equipment revenue during the

conversion period. Industry conversion costs are the upfront investments manufacturers must make to sell

compliant products/equipment. The revenue used for this calculation is the revenue from just the covered

product/equipment associated with each row. The conversion period is the time frame over which

conversion costs are made and lasts from the publication year of a final rule to the compliance year of the

energy conservation standard. The conversion period typically ranges from 3 to 5 years, depending on the

rulemaking.

†

These rulemakings are at the NOPR stage, and all values are subject to change until finalized through

publication of a final rule.

‡ For the refrigerators, refrigerator-freezers, and freezers energy conservation standards direct final rule, the

compliance year (2029 or 2030) varies by product class.

As shown in Table V.29, the rulemakings with the largest overlap of consumer

clothes dryer OEMs include residential clothes washers, consumer conventional cooking

products, dishwashers, refrigerators, refrigerator-freezers, and freezers, and

miscellaneous refrigeration products, which are all part of the multi-product Joint

Agreement submitted by interested parties.

119

As detailed in the Joint Agreement, the

signatories indicated that their recommendations should be considered a “complete

package.” The signatories further stated that “each part of this agreement is contingent

upon the other parts being implemented.” (Joint Agreement, No. 55, p. 3)

119

The microwave ovens energy conservation standards final rule (88 FR 39912), which has 11

overlapping OEMs, was published prior to the joint submission of the multi-product Joint Agreement.

212

The multi-product Joint Agreement states the “jointly recommended compliance

dates will achieve the overall energy and economic benefits of this agreement while

allowing necessary lead-times for manufacturers to redesign products and retool

manufacturing plants to meet the recommended standards across product categories.”

(Joint Agreement, No. 55 at p. 2) The staggered compliance dates help mitigate

manufacturers’ concerns about their ability to allocate sufficient resources to comply with

multiple concurrent amended standards and about the need to align compliance dates for

products that are typically designed or sold as matched pairs (such as residential clothes

washers and consumer clothes dryers). See section IV.J.3 of this document for

stakeholder comments about cumulative regulatory burden. See Table V.30 for a

comparison of the estimated compliance dates based on EPCA-specified timelines and

the compliance dates detailed in the Joint Agreement.

Table V.30 Expected Compliance Dates for Multi-Product Joint Agreement

Rulemaking

Estimated Compliance

Year based on EPCA

Requirements

Compliance Year in the

Joint Agreement

Consumer Clothes Dryers 2027 2028

Residential Clothes Washers 2027 2028

Consumer Conventional

Cooking Products

2027 2028

Dishwashers 2027 2027*

Refrigerators, Refrigerator-

Freezers, and Freezers

2027

2029 or 2030 depending

on the product class

Miscellaneous Refrigeration

Products

2029 2029

* Estimated compliance year. The Joint Agreement states, “3 years after the publication of a final rule in the Federal

213

3. National Impact Analysis

This section presents DOE’s estimates of the national energy savings and the

NPV of consumer benefits that would result from each of the TSLs considered as

potential amended standards.

a. Significance of Energy Savings

To estimate the energy savings attributable to potential amended standards for

consumer clothes dryers, DOE compared clothes dryer energy consumption under the no-

new-standards case to their anticipated energy consumption under each TSL. The

savings are measured over the entire lifetime of products purchased in the 30-year period

that begins in the year of anticipated compliance with amended standards (2027–2056).

120

Table V.31 presents DOE’s projections of the national energy savings for each TSL

considered for consumer clothes dryers. The savings were calculated using the approach

described in section IV.H.2 of this document.

Table V.31 Cumulative National Energy Savings for Consumer Clothes Dryers; 30

Years of Shipments (2027–2056)*

Trial Standard Level

quads

Primary energy 0.55 1.53 2.57 3.41 9.42 9.47

FFC energy

0.57

1.58

2.66

3.52

9.70

9.76

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

OMB Circular A-4 requires agencies to present analytical results including

separate schedules of the monetized benefits and costs that show the type and timing of

120

The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

214

benefits and costs. Circular A-4 also directs agencies to consider the variability of key

elements underlying the estimates of benefits and costs. For this rulemaking, DOE

undertook a sensitivity analysis using 9 years, rather than 30 years, of product shipments.

The choice of a 9-year period is a proxy for the timeline in EPCA for the review of

certain energy conservation standards and potential revision of and compliance with such

revised standards.

121

The review timeframe established in EPCA is generally not

synchronized with the product lifetime, product manufacturing cycles, or other factors

specific to consumer clothes dryers. Thus, such results are presented for informational

purposes only and are not indicative of any change in DOE’s analytical methodology.

The NES sensitivity analysis results based on a 9-year analytical period are presented in

Table V.32. The impacts are counted over the lifetime of consumer clothes dryers

purchased during the period 2027–2035.

122

Table V.32 Cumulative National Energy Savings for Consumer Clothes Dryers;

9 Years of Shipments (2027–2035)*

Trial Standard Level

quads

Primary energy

0.19

0.54

0.92

1.17

2.80

2.81

FFC energy

0.20

0.56

0.96

1.21

2.89

2.90

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2036.

121

EPCA requires DOE to review its standards at least once every 6 years, and requires, for certain

products, a 3-year period after any new standard is promulgated before compliance is required, except that

in no case may any new standards be required within 6 years of the compliance date of the previous

standards. While adding a 6-year review to the 3-year compliance period adds up to 9 years, DOE notes

that it may undertake reviews at any time within the 6-year period and that the 3-year compliance date may

yield to the 6-year backstop. A 9-year analysis period may not be appropriate given the variability that

occurs in the timing of standards reviews and the fact that for some products, the compliance period is 5

years rather than 3 years.

122

The analysis period for TSL 3 (the Recommended TSL) is 2028–2036.

215

b. Net Present Value of Consumer Costs and Benefits

DOE estimated the cumulative NPV of the total costs and savings for consumers

that would result from the TSLs considered for consumer clothes dryers. In accordance

with OMB’s guidelines on regulatory analysis, DOE calculated NPV using both a 7-

percent and a 3-percent real discount rate. Table V.33 shows the consumer NPV results

with impacts counted over the lifetime of products purchased during the period 2027–

2056.

Table V.33 Cumulative Net Present Value of Consumer Benefits for Consumer

Clothes Dryers; 30 Years of Shipments (2027–2056)*

Discount Rate

Trial Standard Level

billion 2022$

3 percent

4.07

12.33

20.08

19.85

31.21

30.50

7 percent

1.92

5.88

9.23

8.42

9.03

8.58

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

The NPV results based on the aforementioned 9-year analytical period are

presented in Table V.34. The impacts are counted over the lifetime of products

purchased during the period 2027–2035. As mentioned previously, such results are

presented for informational purposes only and are not indicative of any change in DOE’s

analytical methodology or decision criteria.

Table V.34 Cumulative Net Present Value of Consumer Benefits for Consumer

Clothes Dryers; 9 Years of Shipments (2027–2035)*

Discount Rate

Trial Standard Level

billion 2022$

216

3 percent

1.78

5.46

9.08

8.80

13.64

13.41

7 percent

1.07

3.31

5.28

4.77

5.69

5.49

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2036.

The previous results reflect the use of a default trend to estimate the change in

price for consumer clothes dryers over the analysis period (see section IV.F.1 of this

document). DOE also conducted a sensitivity analysis that considered one scenario with

a lower rate of price decline than the reference case and one scenario with a higher rate of

price decline than the reference case. The results of these alternative cases are presented

in appendix 10C of the direct final rule TSD. In the high-price-decline case, the NPV of

consumer benefits is higher than in the default case. In the lower-price-decline case, the

NPV of consumer benefits is lower than in the default case.

c. Indirect Impacts on Employment

DOE estimates that amended energy conservation standards for consumer clothes

dryers will reduce energy expenditures for consumers of those products, with the

resulting net savings being redirected to other forms of economic activity. These

expected shifts in spending and economic activity could affect the demand for labor. As

described in section IV.N of this document, DOE used an input/output model of the U.S.

economy to estimate indirect employment impacts of the TSLs that DOE considered.

There are uncertainties involved in projecting employment impacts, especially changes in

217

the later years of the analysis. Therefore, DOE generated results for near-term

timeframes (2027–2033)

123

, where these uncertainties are reduced.

The results suggest that the adopted standards are likely to have a negligible

impact on the net demand for labor in the economy. The net change in jobs is so small

that it would be imperceptible in national labor statistics and might be offset by other,

unanticipated effects on employment. Chapter 16 of the direct final rule TSD presents

detailed results regarding anticipated indirect employment impacts.

4. Impact on Utility or Performance of Products

As discussed in section III.E.1.d of this document, DOE has concluded that the

standards adopted in this direct final rule will not lessen the utility or performance of the

consumer clothes dryers under consideration in this rulemaking. Manufacturers of these

products currently offer units that meet or exceed the adopted standards.

In response to the August 2022 NOPR, AHAM stated that DOE must ensure that

amended standards do not lengthen cycle times, and AHAM believes that in order to

achieve the test procedure’s current FMC requirement and meet the standards proposed in

the August 2022 NOPR, cycle lengths will get longer. Whirlpool commented that the

strategies used in consumer clothes dryers certified under appendix D2 often lower the

overall average drying temperature and extend the drying time to increase the CEF, while

minimally compliant consumer clothes dryers certified under appendix D1 typically

123

The analysis period for TSL 3 (the Recommended TSL) is 2028–2034.

218

achieve a higher overall temperature and shorten the drying process. Citing DOE’s test

sample, Whirlpool stated that models certified using appendix D1 without wrinkle

prevention mode activated had an average drying time of 56 minutes when tested to

appendix D2, while models certified using appendix D2 had an average drying time of 66

minutes, and ENERGY STAR-qualified products had an average drying time of 71

minutes, the additional time needed to meet the 2-percent FMC requirement. Whirlpool

stated that DOE’s statutory criteria are not met to proceed with the standards proposed in

the August 2022 NOPR due to a clear lessening of performance and utility of the product

associated with longer drying times. (AHAM, No. 46 at pp. 8–10; Whirlpool, No. 53 at p.

DOE’s test data do not support the assertion by AHAM and Whirlpool that

amended standards would necessitate longer drying times. In DOE’s test sample, the

consumer clothes dryers certified under appendix D1 have an average cycle time of 61

minutes when tested in accordance with appendix D2. In comparison, among the units in

DOE’s test sample that are certified under appendix D2 at or above the amended

standard, multiple units have a cycle time less than 60 minutes. This indicates that the

standards adopted by this direct final rule will not necessitate any increase in cycle time

compared to typical cycle times currently associated with baseline consumer clothes

dryers. DOE notes that a 60-minute cycle time is notably less than the 80-minute cycle

time required for ENERGY STAR qualification.

124

DOE further notes that cycle time is

one of many product attributes that consumers consider when purchasing a clothes dryer,

124

ENERGY STAR criteria for consumer clothes dryers can be found at:

www.energystar.gov/products/appliances/clothes_dryers/key_product_criteria.

219

such as drying performance and fabric care. As further examples, Consumer Reports—

which DOE recognizes is one popular resource for consumers seeking independent

reviews of consumer products—highlights the following product attributes for consumer

clothes dryers in addition to cycle time: drying performance, ergonomics, noise level,

capacity, drum material, compatibility with a drying rack, availability of custom

programs, availability of a steam option, moisture sensing capability, Wifi connectivity,

and stackability with an accompanying clothes washer.

125

As noted in section IV.H.2 of this document, DOE has observed a steady decline

in annual consumer clothes dryer cycles over the past 15 years, despite the

implementation of more stringent consumer clothes dryer energy conservation standards,

which is an indication that consumers are not rerunning their clothes dryers. Additionally,

the amended standards correspond to the current ENERGY STAR efficiency level for

both electric and gas standard clothes dryers, which requires testing in accordance with

appendix D2 and which ensures consumer-accepted dryness levels as discussed in section

II.B.2 of this document. As noted above, DOE does not expect increased cycle times

compared to typical cycle times currently associated with baseline consumer clothes

dryers as a result of adopted standards. In addition, DOE does not expect consumers to

re-run the consumer clothes dryer upon completion of the initial run as a result of the

amended standards being adopted in this direct final rule. DOE therefore does not expect

a lessening in performance or utility as a result of the standards adopted by this direct

final rule. As previously discussed, on February 14, 2024, DOE received a second joint

125

Consumer Reports ratings of consumer clothes dryers available at

www.consumerreports.org/appliances/clothes-dryers (last accessed February 5, 2024).

220

statement from the same group of stakeholders that submitted the Joint Agreement in

which the signatories reaffirmed the standards recommended in the Joint Agreement.

126

In particular, the letter states that DOE’s test data show, and industry experience agrees,

that the recommended standard levels for consumer clothes dryers will not result in

significant differences in cycle time and will adequately dry clothes.

Whirlpool stated that due to the core technological differences in energy-saving

heat pump clothes dryers (such as lower air temperatures, heat retention, and water

condensing systems) compared to conventional resistive heater clothes dryers, harder-to-

dry fabrics need additional time in a heat pump clothes dryer to remove their embedded

moisture and some heat pump clothes dryers may not get down to the required FMC.

(Whirlpool, No. 53 at pp. 12–13)

With regard to Whirlpool’s concerns about the performance of heat pump clothes

dryers for certain hard-to-dry fabrics, DOE notes that the standards adopted by this direct

final rule do not require the use of heat pump technology. AHAM stated that longer

consumer clothes dryer cycle times may create different cycle times between clothes

washers and clothes dryers, which may result in different consumer behaviors.

According to AHAM, different operating times in laundry products may result in the

increased use of wrinkle control cycles or redrying loads to avoid wrinkled clothes

resulting from the clothes sitting in the clothes dryer for more extended periods of time,

or in consumers re-washing clothes that were not transferred to the clothes dryer due to a

126

This document is available in the docket at: www.regulations.gov/comment/EERE-2014-BT-STD-0058-

0058.

221

previous load still being dried, ultimately resulting in increased water and energy use.

AHAM also stated that consumers could turn to using other cycles, thus undercutting

savings designed to be achieved through use of the normal cycle. AHAM and Whirlpool

therefore stated that DOE should evaluate the impact of amended standards on drying

times as cycle length is a performance feature associated with consumer preferences that

consumers are unlikely to accept if cycles are too long and do not match washing times.

AHAM also disagreed with DOE’s use of the maximum drying time of 80 minutes in the

current ENERGY STAR specification as a benchmark for its analysis, asserting that the

specification was not based on sufficient supporting or consumer-relevant data. (AHAM,

No. 46 at pp. 8–10)

As previously stated, DOE does not expect a shift in consumer drying times

associated with amended standards beyond what is typically experienced by consumers

of baseline consumer clothes dryers. Additionally, DOE does not expect that the

amended standards would result in longer drying cycles given the prevalence on the

market of consumer clothes dryers that meet the amended standard with cycle times

comparable to those of current baseline models, regardless of the longer cycle time of 80

minutes allowed in the ENERGY STAR specification. Therefore, DOE has no basis to

conclude that the amended standards would alter the existing relative cycle times between

consumer clothes dryers and clothes washers.

The test data presented in the August 2022 NOPR contradict certain conclusions

and presumptions made by DOE in previous rulemakings with regard to cycle times. In

particular, in a NOPR published on August 13, 2020 (“August 2020 NOPR”), which

222

preceded the December 2020 Final Rule, DOE stated its presumption that the shortest

possible cycle times currently available on the market represent the models for which

certain manufacturers have prioritized cycle time while maintaining adequate drying

performance and other performance aspects of consumer clothes dryers; and that based

on this presumption, the current energy conservation standards may have discouraged

manufacturers from bringing models to the market with cycle times of 30 minutes or less.

85 FR 49297, 49305 reiterated at 85 FR 81359, 81361. DOE further asserted that offering

products with shorter cycle times would require more per-cycle energy use than would be

permitted under the current standards in order to maintain the same level of performance

in other areas. 85 FR 49297, 49299.

DOE has determined, contrary to the August 2020 NOPR’s assumptions, that

current energy conservation standards have not prevented the sale of consumer clothes

dryers with shorter cycle times. DOE’s test data presented in the August 2022 NOPR

indicate no discernable correlation between efficiency level and cycle time for vented

electric standard dryers or vented gas clothes dryers (i.e., the consumer clothes dryer

product classes subject to the December 2020 Final Rule) Indeed, for vented electric

standard clothes dryers, the most efficient model in DOE’s test sample has a shorter cycle

time (80 minutes) than the least efficient minimally-compliant model in DOE’s test

sample (98 minutes). The models with the lowest cycle times of 36 and 39 minutes both

achieve higher efficiency level EL 3. Similarly, for vented gas clothes dryers, the most

efficient model in DOE’s test sample has a cycle time of 66 minutes, substantially similar

to the baseline unit with a cycle time of 65 minutes. The models with the lowest cycle

times of 35 and 36 minutes both achieve higher efficiency level EL 2. Based on this data,

223

DOE reaches a different conclusion than was reached in the December 2020 Final Rule.

In particular, noting that DOE’s data show no discernable correlation between efficiency

and cycle time, this data does not support DOE’s prior assertion that the current

consumer clothes dryer energy conservation standards may be precluding manufacturers

from bringing models to the market with substantially shorter cycle times, or DOE’s prior

presumption that offering products with shorter cycle times would require more per-cycle

energy use than would be permitted under the current standards.

Furthermore, in the second joint statement submitted February 14, 2024, by the

signatories of the Joint Agreement, the signatories acknowledge that DOE’s investigative

testing shows that there is no significant difference in cycle time between consumer

clothes dryers in DOE’s data set that are less efficient than the recommended standards

and those that just meet the recommended standard levels. The signatories noted, for

example, that the difference in average cycle time is only about 2 minutes between

electric standard clothes dryers in DOE’s data set that are less efficient than the

recommended standard and those that just meet the recommended standard (with CEFs of

3.93 and 3.94). Moreover, the signatories stated that the electric standard clothes dryers

in DOE’s data set that are less efficient than the recommended standards include models

with longer cycle times than those that meet the recommended standards, suggesting that

cycle time is tied to more than efficiency alone.

Finally, for the reasons previously discussed, DOE has also determined that the

standards adopted in this direct final rule will not result in any significant differences in

drying cycle times.

224

AHAM and Whirlpool commented that longer cycle times also cause more wear

and tear on clothing as well as on the product itself and can decrease the lifetime of the

product and increase the need for repair. Whirlpool stated that longer cycles lead to

consumer perception that their clothes are being damaged and potentially lead consumers

to interrupt consumer clothes dryer cycles to prevent garment damage, depending on

different fabric types/thicknesses. Whirlpool commented that when presented with the

concept of a lower-heat and slower-drying cycle that would save energy, consumers were

not enthusiastic and did not trust that such a drying strategy would prevent garment

damage or match clothes washer cycle times. Whirlpool stated that, according to its

provided research focused on thread removal counts on test cloth, there is the possibility

of increased fabric damage with longer drying times when the test cloth is in a semi-

saturated state. Whirlpool commented that every 30 minutes of drying time for semi-

saturated fabric is equivalent to 2.4 times the amount of fabric damage that would have

been seen with one complete wash cycle in a front-load clothes washer. Whirlpool

commented that this research showed 17-percent thread removal from 7 minutes of

drying under appendix D1 testing and 40-percent thread removal from 30 minutes of

drying under appendix D2 testing. Whirlpool stated that according to these results,

appendix D2 testing resulted in a longer drying time in which the test cloth was in a semi-

saturated state, as well as 2.4 times the fabric damage as a consumer clothes dryer cycle

under appendix D1 testing. According to Whirlpool, the longer the drying cycle is drawn

out at lower temperatures, the more total friction and thread removal occurs as the semi-

saturated clothes rub together when tumbling in the drum. Whirlpool asserted that fabric

care is partially a story of cycle temperature and mechanical damage from extended

225

drying times, and although there may be some benefit from lower temperatures, the

potentially increased mechanical damage from longer cycles cannot be ignored, nor the

additional cost burden associated with consumers replacing damaged or worn clothing

that was not factored into DOE’s analysis. AHAM stated that manufacturers would also

have to plan for increased wear and tear on the product itself with more robust

components; therefore, AHAM disagreed with DOE’s conclusion that repair and

maintenance costs would not change with the proposed standard. Both AHAM and

Whirlpool stated that DOE should account for the impacts of energy conservation

standards associated with increased drying times on fabric care and the additional cost

burden in its analysis. (AHAM, No. 46 at pp. 9–10; Whirlpool, No. 53 at p. 5)

The fabric care data Whirlpool shared shows increased thread removal from

drying under appendix D2 testing compared to testing under appendix D1 for the same

unit, which according to Whirlpool is due to longer drying times when the test cloth is in

a semi-saturated state. However, DOE notes that amended standards would not require

any specific drying strategy (e.g., longer cycle times, longer drying time at the semi-

saturated state, lower drying temperatures) to ensure the FMC requirement or amended

standards are met nor preclude shorter drying times at the semi-saturated state.

Additionally, DOE notes that this testing did not compare the thread removal from drying

for units with different efficiencies, but rather the same unit tested under two different

tests, so DOE is not aware of any data substantiating a correlation between increased

efficiency and thread removal. As previously noted, appendix D2 accounts for all

consumer clothes dryers with and without automatic termination control and is therefore

more representative of consumer use than appendix D1, and depending on the automatic

226

termination control system, the appendix D2 cycle time may be longer or shorter than

that when testing in accordance with appendix D1. Furthermore, DOE is not aware of

any information indicating that the higher efficiency levels associated with amended

standards would increase cycle time beyond what is typically experienced by consumers

of baseline consumer clothes dryers, and has determined that existing cycle times can be

met with consumer clothes dryers capable of meeting the amended standards. Therefore,

DOE has concluded the recommend standards that are the subject of this direct final rule

would not result in increased impacts on fabric care and product wear and tear as AHAM

and Whirlpool suggested. Additionally, DOE notes that AHAM recommended the

efficiency levels proposed in the August 2022 NOPR for adoption in this direct final rule.

DOE, however, will continue to review relevant data on potential impacts on fabric care

and product wear and tear and may consider it in future rulemakings.

For the reasons discussed throughout this section and based on the additional

confirming statements from the Joint Agreement signatories, DOE has concluded that the

standards adopted in this direct final rule will not lessen the utility or performance of the

consumer clothes dryers under consideration in this rulemaking.

5. Impact of Any Lessening of Competition

DOE considered any lessening of competition that would be likely to result from

new or amended standards. As discussed in section III.E.1.e of this document, EPCA

directs the Attorney General of the United States (“Attorney General”) to determine the

impact, if any, of any lessening of competition likely to result from a proposed standard

and to transmit such determination in writing to the Secretary within 60 days of the

227

publication of a proposed rule, together with an analysis of the nature and extent of the

impact. To assist the Attorney General in making this determination, DOE is providing

the DOJ with copies of this direct final rule and the TSD for review.

6. Need of the Nation to Conserve Energy

Enhanced energy efficiency, where economically justified, improves the Nation’s

energy security, strengthens the economy, and reduces the environmental impacts (costs)

of energy production. Reduced electricity demand due to energy conservation standards

is also likely to reduce the cost of maintaining the reliability of the electricity system,

particularly during peak-load periods. Chapter 15 in the direct final rule TSD presents

the estimated impacts on electricity generating capacity, relative to the no-new-standards

case, for the TSLs that DOE considered in this rulemaking.

Energy conservation resulting from potential energy conservation standards for

consumer clothes dryers is expected to yield environmental benefits in the form of

reduced emissions of certain air pollutants and greenhouse gases. Table V.35 provides

DOE’s estimate of cumulative emissions reductions expected to result from the TSLs

considered in this rulemaking. The emissions were calculated using the multipliers

discussed in section IV.K of this document. DOE reports annual emissions reductions for

each TSL in chapter 13 of the direct final rule TSD.

228

Table V.35 Cumulative Emissions Reduction for Consumer Clothes Dryers Shipped

in 2027–2056*

Trial Standard Level

Power Sector Emissions

(million

metric tons)

11.2 30.8 51.5 66.5 170.9 171.7

(thousand

tons)

0.7

2.0

3.3

4.4

12.0

12.1

(thousand

tons)

0.1

0.3

0.4

0.6

1.7

(thousand

tons)

6.4 17.4 29.3 36.6 87.6 88.0

(thousand

tons)

2.9 8.3 13.6 18.7 52.4 52.7

Hg (tons)

0.02

0.06

0.09

0.13

0.36

Upstream Emissions

(million

metric tons)

1.2 3.3 5.6 7.0 17.7 17.8

(thousand

tons)

114.0

309.4

524.3

657.1

1,633

1,642

(thousand

tons)

0.005 0.001 0.021 0.003 0.1 0.1

(thousand

tons)

18.9

51.6

87.3

110.0

276.5

277.9

(thousand

tons)

0.1 0.2 0.3 0.3 1.0 1.0

Hg (tons)

0.0001

0.0002

0.0003

0.0005

0.0013

Total FFC Emissions

(million

metric tons)

12.4 34.1 57.1 73.5 188.6 189.5

(thousand

tons)

114.7 311.4 527.6 661.5 1,645 1,654

(thousand

tons)

0.1

0.3

0.5

0.6

1.7

(thousand

tons)

25.4 69.0 116.5 146.6 364.1 365.9

(thousand

tons)

3.0

8.4

13.9

19.0

53.3

53.6

Hg (tons)

0.02

0.06

0.10

0.13

0.36

0.37

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

229

As part of the analysis for this rule, DOE estimated monetary benefits likely to

result from the reduced emissions of CO

that DOE estimated for each of the considered

TSLs for consumer clothes dryers. Section IV.L of this document discusses the estimated

SC-CO

values that DOE used. Table V.36 presents the value of CO

emissions

reduction at each TSL for each of the SC-CO

cases. The time series of annual values is

presented for the selected TSL in chapter 14 of the direct final rule TSD.

Table V.36 Present Value of CO

Emissions Reduction for Consumer Clothes

Dryers Shipped in 2027–2056*

TSL

SC-CO

Case

Discount Rate and Statistics

2.5%

Average

percentile

million 2022$

136

565

876

1,718

376

1,559

2,415

4,739

613

2,566

3,985

7,800

808

3,353

5,197

10,192

2,012

8,435

13,115

25,622

2,022

8,479

13,183

25,753

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

As discussed in section IV.L.2 of this document, DOE estimated the climate

benefits likely to result from the reduced emissions of methane and N

O that DOE

estimated for each of the considered TSLs for consumer clothes dryers. Table V.37

presents the value of the CH

emissions reduction at each TSL, and Table V.38 presents

the value of the N

O emissions reduction at each TSL. The time series of annual values is

presented for the selected TSL in chapter 14 of the direct final rule TSD.

230

Table V.37 Present Value of Methane Emissions Reduction for Consumer Clothes

Dryers Shipped in 2027–2056*

TSL

SC-CH

Case

Discount Rate and Statistics

2.5%

Average

percentile

million 2022$

165

229

438

156

450

623

1,193

259

754

1,046

1,996

331

954

1,321

2,527

801

2,342

3,252

6,200

805

2,354

3,268

6,230

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

Table V.38 Present Value of Nitrous Oxide Emissions Reduction for Consumer

Clothes Dryers Shipped in 2027–2056*

TSL

SC-N

O Case

Discount Rate and Statistics

2.5%

Average

percentile

million 2022$

0.4

1.6

2.5

4.4

1.2

4.6

7.1

12.3

1.9

7.5

11.6

20.0

2.7

10.3

15.8

27.4

7.1

27.6

42.5

73.6

7.1

27.8

42.7

74.0

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

DOE is well aware that scientific and economic knowledge about the contribution

of CO

and other GHG emissions to changes in the future global climate and the potential

resulting damages to the global and U.S. economy continues to evolve rapidly. DOE,

together with other Federal agencies, will continue to review methodologies for

estimating the monetary value of reductions in CO

and other GHG emissions. This

ongoing review will consider the comments on this subject that are part of the public

record for this and other rulemakings, as well as other methodological assumptions and

231

issues. DOE notes, however, that the adopted standards would be economically justified

even without inclusion of monetized benefits of reduced GHG emissions.

DOE also estimated the monetary value of the economic benefits associated with

and SO

emissions reductions anticipated to result from the considered TSLs for

consumer clothes dryers. The dollar-per-ton values that DOE used are discussed in

section IV.L.2 of this document. Table V.39 presents the present value for NO

emissions reductions for each TSL calculated using 7-percent and 3-percent discount

rates, and Table V.40 presents similar results for SO

emissions reductions. The results

in these tables reflect application of EPA’s low dollar-per-ton values, which DOE used to

be conservative. The time series of annual values is presented for the selected TSL in

chapter 14 of the direct final rule TSD.

Table V.39 Present Value of NO

Emissions Reduction for Consumer Clothes

Dryers Shipped in 2027–2056*

TSL

7% Discount Rate

3% Discount Rate

million 2022$

502

1,167

1,391

3,216

2,217

5,305

2,962

6,887

7,133

17,135

7,168

17,222

Note: Results are based on the low benefit-per-ton values.

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

232

Table V.40 Present Value of SO

Emissions Reduction for Consumer Clothes Dryers

Shipped in 2027–2056*

TSL

7% Discount Rate

3% Discount Rate

million 2022$

209

265

594

415

963

590

1,333

1,541

3,630

1,550

3,651

* The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

Not all the public health and environmental benefits from the reduction of

greenhouse gases, NO

, and SO

are captured in the values above, and additional

unquantified benefits from the reductions of those pollutants as well as from the

reduction of direct particulate matter (“PM”) and other co-pollutants may be significant.

DOE has not included monetary benefits of the reduction of Hg emissions because the

amount of reduction is very small.

7. Other Factors

The Secretary of Energy, in determining whether a standard is economically

justified, may consider any other factors that the Secretary deems to be relevant. (42

U.S.C. 6295(o)(2)(B)(i)(VII)) No other factors were considered in this analysis.

8. Summary of Economic Impacts

Table V.41 presents the NPV values that result from adding the estimates of the

economic benefits resulting from reduced GHG and NO

and SO

emissions to the NPV

of consumer benefits calculated for each TSL considered in this rulemaking. The

consumer benefits are domestic U.S. monetary savings that occur as a result of

purchasing the covered products and are measured for the lifetime of products shipped

233

during the period 2027–2056.

127

The climate benefits associated with reduced GHG

emissions resulting from the adopted standards are global benefits and are also calculated

based on the lifetime of consumer clothes dryers shipped during the period 2027–2056.

128

Table V.41 Consumer NPV Combined with Present Value of Climate Benefits and

Health Benefits

Category

TSL 1

TSL 2

TSL 3

TSL 4

TSL 5

TSL 6

Using 3% discount rate for Consumer NPV and Health Benefits (billion 2022$)

5% Average SC-

GHG case

5.6 16.7 27.2 29.2 54.8 54.2

3% Average SC-

GHG case

6.2 18.2 29.7 32.4 62.8 62.2

2.5% Average SC-

GHG case

6.6 19.2 31.4 34.6 68.4 67.9

3% 95th percentile

SC-GHG case

7.6

22.1

36.2 40.8 83.9 83.4

Using 7% discount rate for Consumer NPV and Health Benefits (billion 2022$)

5% Average SC-

GHG case

2.7 8.1 12.7 13.1 20.5 20.1

3% Average SC-

GHG case

3.3 9.6 15.2 16.3 28.5 28.2

2.5% Average SC-

GHG case

3.6 10.6 16.9 18.5 34.1 33.8

3% 95th percentile

SC-GHG case

4.7 13.5 21.7 24.7 49.6 49.4

C. Conclusion

When considering new or amended energy conservation standards, the standards

that DOE adopts for any type (or class) of covered product must be designed to achieve

the maximum improvement in energy efficiency that the Secretary determines is

technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) In

127

The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

128

Id.

234

determining whether a standard is economically justified, the Secretary must determine

whether the benefits of the standard exceed its burdens by, to the greatest extent

practicable, considering the seven statutory factors discussed previously. (42 U.S.C.

6295(o)(2)(B)(i)) The new or amended standard must also result in significant

conservation of energy. (42 U.S.C. 6295(o)(3)(B))

For this direct final rule, DOE considered the impacts of amended standards for

consumer clothes dryers at each TSL, beginning with the maximum technologically

feasible level, to determine whether that level was economically justified. Where the

max-tech level was not justified, DOE then considered the next most efficient level and

undertook the same evaluation until it reached the highest efficiency level that is both

technologically feasible and economically justified and saves a significant amount of

energy.

To aid the reader as DOE discusses the benefits and/or burdens of each TSL,

tables in this section present a summary of the results of DOE’s quantitative analysis for

each TSL. In addition to the quantitative results presented in the tables, DOE also

considers other burdens and benefits that affect economic justification. These include the

impacts on identifiable subgroups of consumers who may be disproportionately affected

by a national standard and impacts on employment.

DOE also notes that the economics literature provides a wide-ranging discussion

of how consumers trade off upfront costs and energy savings in the absence of

government intervention. Much of this literature attempts to explain why consumers

235

appear to undervalue energy efficiency improvements. There is evidence that consumers

undervalue future energy savings as a result of (1) a lack of information; (2) a lack of

sufficient salience of the long-term or aggregate benefits; (3) a lack of sufficient savings

to warrant delaying or altering purchases; (4) excessive focus on the short-term, in the

form of inconsistent weighting of future energy cost savings relative to available returns

on other investments; (5) computational or other difficulties associated with the

evaluation of relevant tradeoffs; and (6) a divergence in incentives (for example, between

renters and owners, or builders and purchasers). Having less-than-perfect foresight and a

high degree of uncertainty about the future, consumers may trade off these types of

investments at a higher-than-expected rate between current consumption and uncertain

future energy cost savings.

It is important to recognize that while DOE is promulgating two separate

regulatory actions for energy efficiency standards for residential clothes washers and

consumer dryers, clothes washers and dryers are complementary products, and they are

sometimes sold and purchased together as joint goods. This type of consumer purchasing

behavior is not typical of DOE energy efficiency standards. These products are available

in a variety of combinations and the efficiency and/or product class of one product does

not restrict the efficiency and/or product class of the other. The efficiency levels are

independent of each other. Hence, DOE does not directly model the joint purchasing

decision of clothes washers and dryers in this rule. It is possible that if only one machine

fails, consumers could replace one machine or could replace both machines jointly. If

consumers replace both machines when one fails, aggregate lifecycle costs would be the

combination of impacts as presented in both final rules.

236

Consumers value a variety of attributes in consumer clothes dryers. These

attributes can factor into consumer purchasing decisions along with installation and

operating cost. For example, DOE understands certain consumers make purchasing

decisions on non-efficiency attributes such as color or other visual features such as

control panel layout, which may overlap with efficiency considerations related to and a

potential preference for mechanical over electronic controls.

One specific attribute related to the joint use of clothes washers and dryers worth

noting is the moisture content of clothes as consumers wash and dry them. DOE

recognizes that amended clothes washer standards could result in less total moisture

needing to be removed from the clothing in a dryer, whereas amended clothes dryer

standards could result in a less energy-intensive process for removing that moisture. As

explained on page 99, the amended dryer test procedure in appendix D2 includes

incoming RMC values (i.e., a starting lower moisture content for the load) that are more

representative of the resulting moisture content seen in high-efficiency clothes washers.

Due to the uniqueness of the Joint Recommendation where the clothes washer and dryer

proposals and compliance dates were aligned, the dryer rulemaking encompasses these

lower initial moisture values as a starting point for the energy use analysis, so the effect

of faster spin speeds resulting in less “wet” clothes is already captured by DOE. The

relative comparison of efficiency levels for a given product would remain the same, even

if the baseline energy consumption were adjusted due to an increase in efficiency in the

complementary product.

237

General considerations for consumer welfare and preferences as well as the

special cases of complementary goods are areas DOE plans to explore in a forthcoming

RFI related to the agency’s updates to its overall analytic framework.

In DOE’s current regulatory analysis, potential changes in the benefits and costs

of a regulation due to changes in consumer purchase decisions are included in two ways.

First, if consumers forego the purchase of a product in the standards case, this decreases

sales for product manufacturers, and the impact on manufacturers attributed to lost

revenue is included in the MIA. Second, DOE accounts for energy savings attributable

only to products actually used by consumers in the standards case; if a standard decreases

the number of products purchased by consumers, this decreases the potential energy

savings from an energy conservation standard. DOE provides estimates of shipments and

changes in the volume of product purchases in chapter 9 of the direct final rule TSD.

However, DOE’s current analysis does not explicitly control for heterogeneity in

consumer preferences, preferences across subcategories of products or specific features,

or consumer price sensitivity variation according to household income.

129

While DOE is not prepared at present to provide a fuller quantifiable framework

for estimating the benefits and costs of changes in consumer purchase decisions due to an

energy conservation standard, DOE is committed to developing a framework that can

support empirical quantitative tools for improved assessment of the consumer welfare

impacts of appliance standards. DOE has posted a paper that discusses the issue of

129

P.C. Reiss and M.W. White. Household Electricity Demand, Revisited. Review of Economic Studies.

2005. 72(3): pp. 853–883. doi: 10.1111/0034-6527.00354.

238

consumer welfare impacts of appliance energy conservation standards, and potential

enhancements to the methodology by which these impacts are defined and estimated in

the regulatory process.

130

1. Benefits and Burdens of TSLs Considered for Consumer Clothes Dryer Standards

Table V.42 and Table V.43 summarize the quantitative impacts estimated for each

TSL for consumer clothes dryers. The national impacts are measured over the lifetime of

consumer clothes dryers purchased in the 30-year period that begins in the anticipated

year of compliance with amended standards (2027–2056).

131

The energy savings,

emissions reductions, and value of emissions reductions refer to full-fuel-cycle results.

DOE is presenting monetized benefits of GHG emissions reductions in accordance with

the applicable Executive orders and DOE would reach the same conclusion presented in

this notice in the absence of the social cost of greenhouse gases, including the Interim

Estimates presented by the Interagency Working Group. The efficiency levels contained

in each TSL are described in section V.A of this document.

130

Sanstad, A. H. Notes on the Economics of Household Energy Consumption and Technology Choice.

2010. Lawrence Berkeley National Laboratory. Available at

www1.eere.energy.gov/buildings/appliance_standards/pdfs/consumer_ee_theory.pdf (last accessed July 1,

2021).

131

The analysis period for TSL 3 (the Recommended TSL) is 2028–2057.

239

Table V.42 Summary of Analytical Results for Consumer Clothes Dryers TSLs:

National Impacts

Category

TSL 1

TSL 2

TSL 3

TSL 4

TSL 5

TSL 6

Cumulative FFC National Energy Savings (quads)

Quads

0.57

1.58

2.66

3.52

9.70

9.76

Cumulative FFC Emissions Reduction (Total FFC Emissions)

(million metric

tons)

12.4 34.1

57.1

73.5 188.6 189.6

(thousand tons)

114.8

311.4

527.6

661.6

1,646

1,654

O (thousand tons)

0.1

0.3

0.5

0.6

1.7

(thousand tons)

25.4

69.0

116.5

146.7

364.1

366.0

(thousand tons)

3.0

8.4

13.9

19.0

53.3

53.6

Hg (tons)

0.02

0.1

0.4

Present Value of Monetized Benefits and Costs (3% discount rate, billion 2022$)

Consumer Operating Cost

Savings

4.3 12.7 21.1 28.8 77.4 77.8

Climate Benefits*

0.7

2.0

3.3

4.3

10.8

10.9

Health Benefits**

1.4

3.8

6.3

8.2

20.8

20.9

Total Benefits†

6.4

18.5

30.7

41.3

108.9

109.5

Consumer Incremental

Product Costs‡

0.2 0.4 1.0 8.9 46.2 47.3

Consumer Net Benefits

4.1

12.3

20.1

19.9

31.2

30.5

Total Net Benefits

6.2

18.2

29.7

32.4

62.8

62.2

Present Value of Monetized Benefits and Costs (7% discount rate, billions 2022$)

Consumer Operating Cost

Savings

2.0 6.1 9.8 13.7 35.2 35.4

Climate Benefits*

0.7

2.0

3.3

4.3

10.8

10.9

Health Benefits**

0.6

1.7

2.6

3.6

8.7

Total Benefits†

3.4

9.8

15.8

21.6

54.7

55.0

Consumer Incremental

Product Costs‡

0.1 0.2 0.6 5.3 26.2 26.8

Consumer Net Benefits

1.9

5.9

9.2

8.4

9.0

8.6

Total Net Benefits

3.3

9.6

15.2

16.3

28.5

28.2

Note: This table presents the costs and benefits associated with consumer clothes dryers shipped during the

period 2027−2056 for all TSLs except TSL 3 (the Recommended TSL) and 2028−2057 for TSL 3. These

results include benefits to consumers which accrue after 2056 from the products shipped during the period

2027−2056 for all TSLs except for TSL 3 and 2057 from the products shipped during the period

2028−2057.

* Climate benefits are calculated using four different estimates of the SC-CO

, SC-CH

and SC-N

Together, these represent the global SC-GHG. For presentational purposes of this table, the climate benefits

associated with the average SC-GHG at a 3-percent discount rate are shown; however, DOE emphasizes

the importance and value of considering the benefits calculated using all four sets of SC-GHG estimates.

To monetize the benefits of reducing GHG emissions, this analysis uses the interim estimates presented in

the Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates

Under Executive Order 13990 published in February 2021 by the IWG.

** Health benefits are calculated using benefit-per-ton values for NO

and SO

. DOE is currently only

monetizing (for NO

and SO

) PM

2.5

precursor health benefits and (for NO

) ozone precursor health

benefits, but will continue to assess the ability to monetize other effects such as health benefits from

reductions in direct PM

2.5

emissions. The health benefits are presented at real discount rates of 3 and 7

percent. See section IV.L of this document for more details.

† Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and

net benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-

percent discount rate.

240

Table V.43 Summary of Analytical Results for Consumer Clothes Dryers TSLs:

Manufacturer and Consumer Impacts

Category

TSL 1*

TSL 2*

TSL 3*

TSL 4*

TSL 5*

TSL 6*

Manufacturer Impacts

Industry NPV (million

2022$) (No-new-

standards case INPV =

2,115.4)

2,080.3

2,084.3

2,061.1

to 2,069.5

1,971.2 to

1,995.8

1,501.9 to

1,724.8

679.9 to

1,800.8

604.3 to

1,753.5

Industry NPV (%

change)

(1.7) to

(1.5)

(2.6) to

(2.2)

(6.8) to

(5.7)

(29.0) to

(18.5)

(67.9) to

(14.9)

(71.4) to

(17.1)

Consumer Average LCC Savings (2022$)

Electric, Standard

$150

$170

$252

$101

$41

Electric, Compact (120

$53 $83

$66

$66 $66 ($209)

Vented Electric,

Compact (240 V)

$38 $89

$90

$90 $22 ($230)

Vented Gas, Standard

$48

$112

$102

$13

Ventless Electric,

Compact (240 V)

$0 $99

$99

$99 $99 ($102)

Ventless Electric,

Combination Washer-

Dryer

$10

$11

$10

($531)

Shipment-Weighted

Average

$131 $159 $224 $100 $36 $29

Consumer Simple PBP (years)

Electric, Standard

0.5

0.6

2.1

5.8

Electric, Compact (120

1.5 1.5 2.2 2.2 2.2 18.1

Vented Electric,

Compact (240 V)

2.1 1.5 2.0 2.0 6.6 20.4

Vented Gas, Standard

2.5

1.3

1.9

5.0

Ventless Electric,

Compact (240 V)

0.0 0.4 0.4 0.4 0.4 11.4

Ventless Electric,

Combination Washer-

Dryer

0.0

46.3

Shipment-Weighted

Average

0.9 0.6 0.8 2.1 5.6 6.1

Percent of Consumers that Experience a Net Cost

Electric, Standard

1.2%

0.9%

48.0%

63.1%

Electric, Compact (120

4.8% 5.1% 21.4% 21.7% 21.7% 90.9%

Vented Electric,

Compact (240 V)

5.7% 4.6% 12.4% 12.6% 60.7% 92.8%

Vented Gas, Standard

2.7%

1.7%

7.1%

7.0%

68.7%

Ventless Electric,

Compact (240 V)

0.0% 0.0% 0.0% 0.0% 0.0% 58.6%

Ventless Electric,

Combination Washer-

Dryer

0.0%

95.0%

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Category

TSL 1*

TSL 2*

TSL 3*

TSL 4*

TSL 5*

TSL 6*

Shipment-Weighted

Average

1.5% 1.0% 2.0% 40.4% 63.3% 64.5%

Parentheses indicate negative (-) values.

* Weighted by shares of each product class in total projected shipments in 2027 for all TSLs except TSL 3

and in 2028 for TSL 3.

DOE first considered TSL 6, which represents the max-tech efficiency level and

includes the design parameters of the most efficient products available on the market or

in working prototypes for all product classes. The max-tech design options include heat

pump technology for electric consumer clothes dryers and inlet air preheat technology for

gas consumer clothes dryers. DOE’s shipments analysis estimates approximately 1

percent of annual consumer clothes dryer shipments currently meet this level. TSL 6

would save an estimated 9.76 quads of energy, an amount DOE considers significant.

Under TSL 6, the NPV of consumer benefit would be $8.6 billion using a discount rate of

7 percent, and $30.5 billion using a discount rate of 3 percent.

The cumulative emissions reductions at TSL 6 are 189.6 Mt of CO

, 53.6

thousand tons of SO

, 366.0 thousand tons of NO

, 0.4 ton of Hg, 1,654 thousand tons of

and 1.7 thousand tons of N

O. The estimated monetary value of the climate benefits

from reduced GHG emissions (associated with the average SC-GHG at a 3-percent

discount rate) at TSL 6 is $10.9 billion. The estimated monetary value of the health

benefits from reduced SO

and NO

emissions at TSL 6 is $8.7 billion using a 7-percent

discount rate and $20.9 billion using a 3-percent discount rate.

Using a 7-percent discount rate for consumer benefits and costs, health benefits

from reduced SO

and NO

emissions, and the 3-percent discount rate case for climate

242

benefits from reduced GHG emissions, the estimated total NPV at TSL 6 is $28.2 billion.

Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL

6 is $62.2 billion. The estimated total NPV is provided for additional information;

however, DOE primarily relies upon the NPV of consumer benefits when determining

whether a standard level is economically justified.

At TSL 6, the average LCC impact on affected consumers is a savings of $41 for

electric standard, -$209 for electric compact (120V), -$230 for vented electric compact

(240V), $13 for vented gas standard, -$102 for ventless electric compact (240V), and -

$531 for ventless electric combination washer-dryer. The simple PBP is 6 years for

electric standard, 18 years for electric compact (120V), 20 years for vented electric

compact (240V), 5 years for vented gas standard, 11 years for ventless electric compact

(240V), and 46 years for ventless electric combination washer-dryer. The fraction of

consumers experiencing a net LCC cost is 63 percent for electric standard, 91 percent for

electric compact (120V), 93 percent for vented electric compact (240V), 69 percent for

vented gas standard, 59 percent for ventless electric compact (240V), and 95 percent for

ventless electric combination washer-dryer. Overall, across the product classes, the

majority of consumers will experience a net LCC cost, especially for senior households.

DOE estimated that more 72 percent of senior-only households will experience a net

LCC cost at TSL 6.

At TSL 6, the projected change in INPV ranges from a decrease of $1,511.1

million to a decrease of $361.9 million, corresponding to decreases of 71.4 percent and

17.1 percent, respectively. The loss in INPV is largely driven by industry conversion

243

costs as manufacturers work to redesign their portfolios of model offerings and retool

entire factories to comply with amended standards at this level. Industry conversion costs

could reach $1,516.9 million at this TSL.

Conversion costs at TSL 6 are significant, as nearly all existing consumer clothes

dryer models would need to be redesigned to meet the max-tech efficiencies.

Approximately 1 percent of industry shipments currently meet TSL 6. For the electric

clothes dryer product classes, manufacturers would need to implement heat pump

technology to meet max-tech levels. Out of the 19 OEMs that manufacture electric

consumer clothes dryers, nine OEMs offer heat pump models for the U.S. market. The

remaining 10 OEMs do not offer any models for the domestic market that utilize heat

pump technology. A standard that could only be met using heat pump technology would

require a total renovation of existing production facilities and would require most

manufacturers to design completely new clothes dryer platforms, as they would not be

able to maintain the resistive heating designs that currently dominate the U.S. electric

clothes dryer market. In interviews, several manufacturers expressed concern about a

potential shortage of products given the required scale of investment, redesign efforts,

and 3-year compliance timeline.

For gas consumer clothes dryers, manufacturers would need to implement inlet air

preheat technology along with other design options to meet the efficiency levels required

by TSL 6. Thus far, consumer clothes dryers with this technology and performance have

not been observed in consumer clothes dryers available on the consumer market.

Consumer clothes dryers with inlet air preheat designs have been observed only in

244

laboratory settings. In interviews, some manufacturers raised concerns about

implementing a relatively untested technology for the consumer market. There is very

little industry experience with inlet air preheat designs. Several manufacturers speculated

that implementing inlet air preheat technology would require a major overhaul of existing

production facilities and a significant amount of engineering time.

At this level, DOE estimates an 11-percent drop in shipments in the year the

standard takes effect compared to the no-new-standards case, as price-sensitive

consumers may forgo purchasing a new clothes dryer or rely on alternatives such as

repair or purchasing a used dryer due to the increased upfront cost of baseline models.

The Secretary concludes that at TSL 6 for consumer clothes dryers, the benefits of

energy savings, positive NPV of consumer benefits, emission reductions, and the

estimated monetary value of the emissions reductions would be outweighed by the

economic burden on many consumers, especially senior-only households, as well as the

impacts on manufacturers, including the potential for large conversion costs and

reduction in INPV.

TSL 6, representing the most efficient heat pump technology on the market,

would provide significant energy savings potential, as discussed. Despite the current and

potential future benefits of heat pump technology, the analysis at TSL 6 indicates that a

significant fraction of consumers, including low-income and senior-only households,

would experience a net cost given the current relatively high incremental cost of certain

consumer clothes dryers at the max-tech efficiency level. This is particularly pronounced

245

for electric standard clothes dryers, where the incremental production cost at the max-

tech efficiency level is comparable to the manufacturer production cost for the baseline

efficiency level. Consumers with existing electric standard clothes dryers below EL 4

(about 55 percent) and consumers with existing vented gas standard clothes dryers below

EL 3 (about 50 percent) are more likely to experience a net cost at TSL 6, given the

relatively modest decrease in operating costs compared to the high incremental installed

costs as represented by the weighted average LCC savings of $30. Few products

currently meet the efficiency levels required by TSL 6. DOE estimates that

approximately 1 percent of current shipments meet the max-tech efficiencies. At max-

tech, limited industry experience by certain manufacturers with the high-efficiency

design options, the large conversion costs to update facilities and product designs, and

expected drop in industry shipments would result in a reduction of INPV and a potential

shortage of products given the required scale of investment, redesign efforts, and time

constraints. Consequently, the Secretary has concluded that TSL 6 is not economically

justified.

DOE then considered TSL 5, which represents the maximum energy savings with

maximum positive NPV. TSL 5 corresponds to the max-tech level (EL 7), which

represents heat pump technology, for the electric standard product class, and the

efficiency levels corresponding to modulating (2-stage) heating technology in the electric

compact (120V) and inlet air preheat technology in the vented electric compact (240V)

product classes considered in this analysis. For the vented gas standard product class,

TSL 5 corresponds to the max-tech level (EL 4), which represents inlet air preheat

technology. TSL 5 would save an estimated 9.70 quads of energy, an amount DOE

246

considers significant. Under TSL 5, the NPV of consumer benefit would be $9.0 billion

using a discount rate of 7 percent, and $31.2 billion using a discount rate of 3 percent.

The cumulative emissions reductions at TSL 5 are 188.6 Mt of CO

, 53.3

thousand tons of SO

, 364.1 thousand tons of NO

, 0.4 ton of Hg, 1,646 thousand tons of

and 1.7 thousand tons of N

O. The estimated monetary value of the climate benefits

from reduced GHG emissions (associated with the average SC-GHG at a 3-percent

discount rate) at TSL 5 is $10.8 billion. The estimated monetary value of the health

benefits from reduced SO

and NO

emissions at TSL 5 is $ 8.7 billion using a 7-percent

discount rate and $20.8 billion using a 3-percent discount rate.

Using a 7-percent discount rate for consumer benefits and costs, health benefits

from reduced SO

and NO

emissions, and the 3-percent discount rate case for climate

benefits from reduced GHG emissions, the estimated total NPV at TSL 5 is $28.5 billion.

Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL

5 is $62.8 billion. The estimated total NPV is provided for additional information,

however DOE primarily relies upon the NPV of consumer benefits when determining

whether a standard level is economically justified.

At TSL 5, the average LCC impact on affected consumers is a savings of $41 for

electric standard, $66 for electric compact (120V), $22 for vented electric compact

(240V), $13 for vented gas standard, $99 for ventless electric compact (240V), and $10

for ventless electric combination washer-dryer. The simple PBP is 6 years for electric

standard, 2 years for electric compact (120V), 7 years for vented electric compact

247

(240V), 5 years for vented gas standard, 0.4 years for ventless electric compact (240V),

and zero years for ventless electric combination washer-dryer. The fraction of consumers

experiencing a net LCC cost is 63 percent for electric standard, 22 percent for electric

compact (120V), 61 percent for vented electric compact (240V), 69 percent for vented

gas standard, and zero percent for ventless electric compact (240V) and ventless electric

combination washer-dryer. Overall, across the product classes, approximately 63 percent

of consumers will experience a net LCC cost, especially for senior-only households. DOE

estimated that more than 71 percent of senior-only households will experience a net LCC

cost at TSL 5.

At TSL 5, the projected change in INPV ranges from a decrease of $1,435.5

million to a decrease of $314.6 million, corresponding to decreases of 67.9 percent and

14.9 percent, respectively. Industry conversion costs could reach $1,436.9 million at this

TSL.

DOE’s shipments analysis estimates approximately 2 percent of annual shipments

currently meet this level. At TSL 5, the efficiency levels and analyzed design options for

electric standard and vented gas standard dryers (which together account for

approximately 98 percent of industry shipments) are the same as at max-tech. Thus,

requiring heat pump technology for electric standard dryers and inlet air preheat for

vented gas standard dryers would result in similar conversion costs, reduction in INPV,

and drop in shipments as TSL 6.

248

At this level, DOE estimates a 11-percent drop in shipments in the year the

standard takes effect compared to the no-new-standards case, as price-sensitive

consumers may forgo purchasing a new clothes dryer or rely on alternatives such as

repair or purchasing a used dryer due to the increased upfront cost of baseline models.

The Secretary concludes that at TSL 5 for consumer clothes dryers, the benefits of

energy savings, positive NPV of consumer benefits, emission reductions, and the

estimated monetary value of the emissions reductions would be outweighed by the

economic burden on many consumers, especially senior-only households, as well as the

impacts on manufacturers, including the significant conversion costs and large potential

reduction in INPV. A significant fraction of electric standard clothes dryer consumers,

including low-income and senior-only households, would experience a net cost. This is

due to the high incremental cost of electric standard clothes dryers at the max-tech

efficiency level. Consumers with existing electric standard clothes dryers below EL 4 are

more likely to experience a net cost at TSL 5, given the relatively modest decrease in

operating costs compared to the high incremental installed costs. DOE estimates that

approximately 2 percent of shipments currently meet the efficiencies required by this

TSL. At TSL 5, the limited industry experience by certain manufacturers with the high-

efficiency design options, the large conversion costs to update facilities and product

designs, and expected drop in industry shipments would result in a reduction of INPV

and a potential shortage of products given the required scale of investment, redesign

efforts, and time constraints. Consequently, the Secretary has concluded that TSL 5 is

not economically justified.

249

DOE then considered TSL 4, which represents the maximum national energy

savings with simple PBP less than 4 years for each product class. TSL 4 corresponds to

the EL that represents inlet air preheat technology for the electric standard product class

considered in this analysis. For the electric compact (120V) and vented electric compact

(240V) product classes, TSL 4 corresponds to EL 4, which represents modulating (2-

stage) heating technology. For the vented gas standard product class, TSL 4 corresponds

to EL 3, which also represents modulating (2-stage) heating technology. TSL 4 would

save an estimated 3.52 quads of energy, an amount DOE considers significant. Under

TSL 4, the NPV of consumer benefit would be $8.4 billion using a discount rate of 7

percent, and $19.9 billion using a discount rate of 3 percent.

The cumulative emissions reductions at TSL 4 are 73.5 Mt of CO

, 19.0 thousand

tons of SO

, 146.7 thousand tons of NO

, 0.1 ton of Hg, 661.6 thousand tons of CH

and

0.6 thousand tons of N

O. The estimated monetary value of the climate benefits from

reduced GHG emissions (associated with the average SC-GHG at a 3-percent discount

rate) at TSL 4 is $4.3 billion. The estimated monetary value of the health benefits from

reduced SO

and NO

emissions at TSL 4 is $3.6 billion using a 7-percent discount rate

and $8.2 million using a 3-percent discount rate.

Using a 7-percent discount rate for consumer benefits and costs, health benefits

from reduced SO

and NO

emissions, and the 3-percent discount rate case for climate

benefits from reduced GHG emissions, the estimated total NPV at TSL 4 is $16.3 billion.

Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL

4 is $32.4 billion. The estimated total NPV is provided for additional information;

250

however, DOE primarily relies upon the NPV of consumer benefits when determining

whether a standard level is economically justified.

At TSL 4, the average LCC impact on affected consumers is a savings of $101 for

electric standard, $66 for electric compact (120V), $90 for vented electric compact

(240V), $102 for vented gas standard, $99 for ventless electric compact, and $10 for

ventless electric combination washer-dryer. The simple PBP is 2 years for electric

standard, 2 years for electric compact (120V), 2 years for vented electric compact

(240V), 2 years for vented gas standard, 0.4 years for ventless electric compact (240V),

and 0 years for ventless electric combination washer-dryer. The fraction of consumers

experiencing a net LCC cost is 48 percent for electric standard, 22 percent for electric

compact (120V), 13 percent for vented electric compact (240V), 7 percent for vented gas

standard, and zero percent for ventless electric compact (240V) and ventless electric

combination washer-dryer. Overall, across the product classes, approximately 40 percent

of consumers will experience a net LCC cost, especially for senior households. DOE

estimated that about 45 percent of senior-only households will experience a net LCC cost

at TSL 4.

At TSL 4, the projected change in INPV ranges from a decrease of $613.5 million

to a decrease of $390.6 million, corresponding to decreases of 29.0 percent and 18.5

percent, respectively. Industry conversion costs could reach $667.5 million at this TSL.

At TSL 4, the majority of consumer clothes dryer models would need to be

redesigned to meet the efficiency levels required. DOE’s shipments analysis estimates

251

approximately 15 percent of current shipments meet this level. For electric standard

dryers, the design options include implementing inlet air preheat and other features. As

previously noted, electric standard dryers account for approximately 81 percent of total

shipments. At the current time, there is very little industry experience with inlet air

preheat designs. Currently, DOE is not aware of any consumer clothes dryers on the

market utilizing this design option. DOE’s shipments analysis estimates that

approximately 7 percent of electric standard shipments currently meet the efficiency

required by TSL 4. Implementing inlet air preheat for electric standard dryers would

represent a major overhaul of existing product lines and manufacturing facilities. This

change would necessitate significant investments in new equipment and tooling. Product

conversion costs would be necessary for designing, prototyping, and testing new or

updated platforms.

For vented gas standard clothes dryers, the analyzed design option at TSL 4

includes modulating (2-stage) heat technology, among other design options. Out of the

nine OEMs that manufacture vented gas standard clothes dryers, eight offer products that

meet the efficiencies required at TSL 4. DOE does not believe that there are any

substantive barriers to modulating (2-stage) heating technology. Capital conversion costs

would be necessary as manufacturers increase tooling for 2-stage heating systems.

Product conversion costs would be necessary for cost-optimizing and testing new designs

for a market with amended standards.

At this level, DOE does not expect a notable drop in shipments in the year the

standard takes effect.

252

The Secretary concludes that at TSL 4 for consumer clothes dryers, the benefits of

energy savings, positive NPV of consumer benefits, emission reductions, and the

estimated monetary value of the emissions reductions would be outweighed by the

economic burden on many consumers, especially senior-only households, as well as the

impacts on manufacturers, including the conversion costs and profit margin impacts that

could result in a large reduction in INPV. A significant fraction of electric standard

clothes dryer consumers, including senior-only households, would experience a net cost.

This is due to the high incremental cost of electric standard clothes dryers at the inlet air

preheat technology efficiency level. Consumers with existing electric standard clothes

dryers below EL 4 are more likely to experience a net cost at TSL 4, given the relatively

modest decrease in operating costs compared to the high incremental installed costs. For

electric standard dryers, DOE estimates that approximately 7 percent of shipments

currently meet the efficiency level required by this TSL. At TSL 4, the limited industry

experience of electric standard dryer manufacturers with inlet air preheat technology and

the large conversion costs to update facilities and product designs, would result in a large

reduction of INPV. Consequently, the Secretary has concluded that TSL 4 is not

economically justified.

DOE then considered the Recommended TSL, which represents a set of

intermediate efficiency levels between those designated in TSL 2 and TSL 4 and

corresponds to the current ENERGY STAR efficiency levels for the electric standard and

vented gas standard product classes, which represent approximately 98 percent of the

market. The Recommended TSL corresponds to the EL that represents modulating (2-

stage) heating technology for the electric standard and electric compact (120V) product

253

classes. For the vented gas standard product class, the Recommended TSL corresponds

to EL 3, which also represents modulating (2-stage) heating technology. For the vented

gas compact product class, the Recommended TSL corresponds to baseline CEF

. For

the electric compact (240V) product classes, the Recommended TSL corresponds to EL 2

for vented consumer clothes dryers, which represents a model with an optimized heating

system and EL 1 for ventless consumer clothes dryers, which represents a baseline model

with a more advanced automatic termination control system. For the ventless electric

combination washer-dryer product class, the Recommended TSL corresponds to EL 1,

which represents a baseline model with high-speed spin technology. The Recommended

TSL would save an estimated 2.66 quads of energy, an amount DOE considers

significant. Under the Recommended TSL, the NPV of consumer benefit would be $9.23

billion using a discount rate of 7 percent, and $20.08 billion using a discount rate of 3

percent.

The cumulative emissions reductions at the Recommended TSL are 57.1 Mt of

, 13.9 thousand tons of SO

, 116.5 thousand tons of NO

, 0.1 ton of Hg, 527.6

thousand tons of CH

and 0.5 thousand tons of N

O. The estimated monetary value of

the climate benefits from reduced GHG emissions (associated with the average SC-GHG

at a 3-percent discount rate) at TSL 3 is $3.3 billion. The estimated monetary value of

the health benefits from reduced SO

and NO

emissions at TSL 3 is $2.6 billion using a

7-percent discount rate and $6.3 billion using a 3-percent discount rate.

Using a 7-percent discount rate for consumer benefits and costs, health benefits

from reduced SO

and NO

emissions, and the 3-percent discount rate case for climate

254

benefits from reduced GHG emissions, the estimated total NPV at the Recommended

TSL is $15.2 billion. Using a 3-percent discount rate for all benefits and costs, the

estimated total NPV at the Recommended TSL is $29.7 billion. The estimated total NPV

is provided for additional information; however, DOE primarily relies upon the NPV of

consumer benefits when determining whether a standard level is economically justified.

At the Recommended TSL, the average LCC impact on affected consumers is a

savings of $252 for electric standard, $66 for electric compact (120V), $90 for vented

electric compact (240V), $102 for vented gas standard, $99 for ventless electric compact,

and $11 for ventless electric combination washer-dryer. The simple PBP is 1 year for the

largest product class (electric standard), 2 years for electric compact (120V), 2 years for

vented electric compact (240V), 2 years for vented gas standard, 0.4 years for ventless

electric compact (240V), and 0 years for ventless electric combination washer-dryer. The

fraction of consumers experiencing a net LCC cost is 1 percent for electric standard, 21

percent for PC 2, 12 percent for vented electric compact (240V), 7 percent for vented gas

standard, and zero percent for ventless electric compact (240V) and ventless electric

combination washer-dryer. Overall, across the product classes, approximately 2 percent

of consumers, including low-income and senior-only households, will experience a net

LCC cost.

At the Recommended TSL, the projected change in INPV ranges from a decrease

of $144.2 million to a decrease of $119.7 million, corresponding to decreases of 6.8

percent and 5.7 percent, respectively. Industry conversion costs could reach $180.7

million at this TSL.

255

DOE expects that some existing consumer clothes dryer models would need to be

redesigned to meet the Recommended TSL efficiencies, but there are a wide range of

available models for vented electric standard dryers due to participation in the ENERGY

STAR program. DOE’s shipments analysis estimates approximately 48 percent of annual

shipments currently meet this level. For electric standard, electric compact (120V),

vented electric compact (240V), and vented gas standard clothes dryers, which account

for approximately 99 percent of total annual shipments, the design options include

implementing electronic controls, optimized heating systems, more advanced automatic

termination controls, and modulating (2-stage) heat. Of the 19 electric dryer OEMs, 14

offer products at or above the efficiencies required for the electric dryer product classes at

the Recommended TSL. Out of the nine OEMs that manufacture vented gas standard

clothes dryers, eight offer products that meet the efficiencies required at the

Recommended TSL. Capital conversion costs may be necessary as manufacturers

increase tooling for 2-stage heating systems. Manufacturers may choose to further cost-

optimize and test new designs as a result of the standards, but DOE believes some of this

has already occurred in response to ENERGY STAR. DOE does not expect any drop in

shipments in the year the standard takes effect.

For all TSLs considered in this direct final rule—except for the Recommended

TSL—DOE is bound by the 3-year lead time requirements in EPCA when determining

compliance dates (i.e., compliance with amended standards required in 2027). For the

Recommended TSL, DOE’s analysis utilized the March 1, 2028, compliance date

specified in the Joint Agreement as it was an integral part of the multi-product joint

recommendation. A 2028 compliance year provides manufacturers additional flexibility

256

to spread capital requirements, engineering resources, and conversion activities over a

longer period of time depending on the individual needs of each manufacturer.

At the Recommended TSL, DOE’s data demonstrate no negative impact on

consumer utility for consumer clothes dryers. In addition, the second joint statement from

the same group of stakeholders that submitted the Joint Agreement states that DOE’s test

data show, and industry experience agrees, that the recommended standard level for

consumer clothes dryers will not result in significant differences in cycle time and will

adequately dry clothes.

132

Based on the information available, DOE concludes that no

lessening of product utility or performance would occur at the Recommended TSL.

After considering the analysis and weighing the benefits and burdens, the

Secretary has concluded that a standard set at the Recommended TSL for consumer

clothes dryers would result in the maximum improvement in energy efficiency that is

technologically feasible and economically justified and also result in the significant

conservation of energy. At this TSL, the average LCC savings for all consumer clothes

dryer product classes are positive. An estimated weighted average of 2 percent of

consumer clothes dryer consumers would experience a net cost. The FFC national energy

savings are significant and the NPV of consumer benefits is positive using both a 3-

percent and 7-percent discount rate. Notably, the benefits to consumers vastly outweigh

the cost to manufacturers. At the Recommended TSL, the NPV of consumer benefits,

even measured at the more conservative discount rate of 7 percent, is over 64 times

132

This document is available in the docket at: www.regulations.gov/comment/EERE-2014-BT-STD-0058-

0058.

257

higher than the maximum estimated manufacturers’ loss in INPV. The positive LCC

savings—a different way of quantifying consumer benefits—reinforces this conclusion.

The standard levels at the Recommended TSL are economically justified even without

weighing the estimated monetary value of emissions reductions. When those emissions

reductions are included—representing $3.3 billion in climate benefits (associated with the

average SC-GHG at a 3-percent discount rate), and $6.3 billion (using a 3-percent

discount rate) or $2.6 billion (using a 7-percent discount rate) in health benefits—the

rationale becomes stronger still.

As stated, DOE conducts the walk-down analysis to determine the TSL that

represents the maximum improvement in energy efficiency that is technologically

feasible and economically justified as required under EPCA. The walk-down is not a

comparative analysis, as a comparative analysis would result in the maximization of net

benefits instead of energy savings that are technologically feasible and economically

justified, which would be contrary to the statute. 86 FR 70892, 70908. Although DOE

has not conducted a comparative analysis to select the amended energy conservation

standards, DOE notes that as compared to TSL 6, TSL 5, and TSL 4, the Recommended

TSL has higher average LCC savings, smaller percentages of consumers experiencing a

net cost, a lower maximum decrease in INPV, and lower manufacturer conversion costs.

Although DOE considered amended standard levels for consumer clothes dryers

by grouping the efficiency levels for each product class into TSLs, DOE evaluates all

analyzed efficiency levels in its analysis. Accordingly, the Secretary has concluded that

the Recommended TSL would offer the maximum improvement in efficiency that is

258

technologically feasible and economically justified and would result in the significant

conservation of energy. For electric standard and vented gas standard consumer clothes

dryers, which account for approximately 98 percent of U.S. shipments, requiring

efficiency levels above the levels required by the Recommended TSL result in a large

percentage of consumers experiencing a net LCC cost, in addition to significant

manufacturer impacts and reductions in INPV. Additionally, for consumer clothes

dryers, most manufacturers offer products that can meet the Recommended TSL across

both electric and gas consumer clothes dryers. In addition, the Recommended TSL

corresponds to the current ENERGY STAR levels for electric standard and vented gas

standard clothes dryers, which have significant market share and manufacturer support

due to their promotion over the past couple of years as a voluntary energy efficiency

program. The adoption of standards, if finalized, at this TSL may encourage ENERGY

STAR to further consider more efficient levels for dryers in the year leadings up to the

compliance of date of the standard, which would in turn likely spur additional market

introductions of consumer clothes dryers with heat pump technology, foster maturation of

the technology and downward price trends, and further support differentiation within the

dryer market for energy efficient products.

For electric and vented gas standard

consumer clothes dryers, the Recommended TSL is comprised of EL 4 and EL 3,

respectively, resulting in higher LCC savings, a significant reduction in the number of

consumers experiencing a net cost, a lower maximum decrease in INPV, and lower

conversion costs to the point where DOE has concluded they are economically justified,

as discussed for the Recommended TSL in the preceding paragraphs.

259

Therefore, based on the previous considerations, DOE adopts the energy

conservation standards for consumer clothes dryers at the Recommended TSL.

While DOE considered each potential TSL under the criteria laid out in 42 U.S.C.

6295(o) as discussed above, DOE notes that the Recommended TSL for consumer

clothes dryers adopted in this direct final rule is part of a multi-product Joint Agreement

covering six rulemakings (residential clothes washers; consumer clothes dryers;

consumer conventional cooking products; dishwashers; refrigerators, refrigerator-

freezers, and freezers; and miscellaneous refrigeration products). The signatories

indicated that the Joint Agreement for the six rulemakings should be considered as a joint

statement of recommended standards, to be adopted in its entirety. As discussed in

section V.B.2.e of this document, many consumer clothes dryer OEMs also manufacture

residential clothes dryers; consumer conventional cooking products; dishwashers;

refrigerators, refrigerator-freezers, and freezers; and miscellaneous refrigeration products.

Therefore, there are potential integrated benefits to the Joint Agreement. Rather than

requiring compliance with five amended standards in a single year (2027),

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the

negotiated multi-product Joint Agreement staggers the compliance dates for the five

amended standards over a 4-year period (2027–2030). In response to the August 2022

NOPR, AHAM expressed concerns about the timing of ongoing home appliance

rulemakings. Specifically, AHAM commented that there are a number of ongoing

regulations that impact consumer clothes dryer manufacturers. (AHAM, No. 46 at p. 13)

133

The analyses for residential clothes washers (88 FR 13520); consumer clothes dryers (87 FR 51734);

consumer conventional cooking products (88 FR 6818); dishwashers (88 FR 32514); and refrigerators,

refrigerator-freezers, and freezers (88 FR 12452) utilized a 2027 compliance year for analysis at the

proposed rule stage. Miscellaneous refrigeration products (88 FR 12452) utilized a 2029 compliance year

for the NOPR analysis.

260

AHAM has submitted similar comments to other ongoing home appliance

rulemakings.

134

As AHAM is a key signatory of the Joint Agreement, DOE understands

that the compliance dates recommended in the Joint Agreement would help reduce

cumulative regulatory burden. These compliance dates help relieve concern on the part of

some manufacturers about their ability to allocate sufficient resources to comply with

multiple concurrent amended standards and about the need to align compliance dates for

products that are typically designed or sold as matched pairs. The Joint Agreement also

provides additional years of regulatory certainty for manufacturers and their suppliers.

For residential clothes washers and consumer clothes dryers specifically, aligned

compliance dates would help reduce cumulative regulatory burden for the 13 OEMs that

manufacture both residential clothes washers and consumer clothes dryers. In response to

the August 2022 NOPR, AHAM commented that laundry products (RCWs and consumer

clothes dryers) are designed and used in pairs. (AHAM, No. 46 at p. 10) AHAM stated

that an additional design cycle for clothes washers and/or clothes dryers may be

necessary if the effective compliance dates for the two products were out of sync. AHAM

further stated that coordinated compliance dates would greatly reduce burden on

manufacturers and retailers. (Id.)

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AHAM has submitted written comments regarding cumulative regulatory burden for the other five

rulemakings included in the multi-product Joint Agreement. AHAM’s written comments on cumulative

regulatory burden are available at: www.regulations.gov/comment/EERE-2017-BT-STD-0014-0464 (pp.

41–44) for residential clothes washers; www.regulations.gov/comment/EERE-2014-BT-STD-0005-2285

(pp. 44–47) for consumer conventional cooking products; www.regulations.gov/comment/EERE-2019-BT-

STD-0039-0051 (pp. 21–24) for dishwashers; www.regulations.gov/comment/EERE-2017-BT-STD-0003-

0069 (pp. 20–22) for refrigerators, refrigerator-freezers, and freezers; and

www.regulations.gov/comment/EERE-2020-BT-STD-0039-0031 (pp. 12–15) for miscellaneous

refrigeration products.

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The amended energy conservation standards for consumer clothes dryers, which

are expressed as CEF

, are shown in Table V.44.

Table V.44 Amended Energy Conservation Standards for Consumer Clothes Dryers

Product Class

CEF

(lb/kWh)

(i) Electric, Standard (4.4 ft3 or greater capacity)

3.93

(ii) Electric, Compact (120V) (less than 4.4 ft3 capacity)

4.33

(iii) Vented Electric, Compact (240V) (less than 4.4 ft3 capacity)

3.57

(iv) Vented Gas, Standard (4.4 ft3 or greater capacity)

3.48

(v) Vented Gas, Compact (less than 4.4 ft3 capacity)

2.02

(vi) Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity)

2.68

(vii) Ventless Electric, Combination Washer-Dryer

2.33

NEEA, the Joint Commenters, and Samsung supported DOE's proposed TSL 3,

which aligns with the Recommended TSL in this direct final rule, given the national

energy savings, life-cycle cost savings, and reasonable manufacturer impacts. According

to the Joint Commenters, TSL 3 provides large cost savings for all consumer groups,

including low-income households. Samsung supported DOE's proposed TSL 3 and

believes the test sample adequately represents the current marketplace. (NEEA, No. 45 at

p. 2; Joint Commenters, No. 51 at p. 2; Samsung, No. 54 at p. 2)

NYSERDA also supported DOE's proposal in the August 2022 NOPR and urged

expedient adoption of the amended standards given significant LCC savings, reasonable

payback periods, significant GHG emissions reductions, energy savings, and monetary

benefits for consumers in New York and beyond, and the aging out of a significant

portion of the installed dryer stock in New York. According to the 2019 New York

Residential Building Stock Assessment, 49 percent of New York consumer clothes dryers

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are over 10 years old, and another 81 percent are 5 years or older. NYSERDA stated that

based on DOE’s assumption of a product lifetime average of 14 years, a significant

number of dryers in New York will be due for replacement around the time of the new

standard, but only if DOE finalizes this standard promptly. (NYSERDA, No. 48 at pp. 1–

While the California IOUs supported DOE’s conclusion that TSL 3 represented

an economically justified and technologically feasible efficiency level achieving

significant energy savings, the California IOUs requested that DOE clarify the supporting

data that led to the conclusion that TSL 4 was not economically justified. The California

IOUs urged DOE to adopt TSL 3 at the earliest opportunity so that consumers may obtain

the significant savings provided from this level. (California IOUs, No. 50 at pp. 1–2)

As previously stated, TSL 4 is not economically justified. Nearly 50 percent of

electric standard clothes dryer users, including over 53 percent of senior-only households,

would experience a net cost. This can be attributed to the high incremental cost of electric

standard dryers with the inlet air preheat technology efficiency level. Moreover, the

industry conversion costs for implementing TSL 4 could amount to $668 million,

resulting in a substantial decrease in the manufacturer's INPV. In addition, there is very

little industry experience with inlet air preheat designs. Currently, DOE is not aware of

any consumer clothes dryers on the market utilizing this design option. DOE’s shipments

analysis estimates that approximately 7 percent of electric standard shipments currently

meet the efficiency required by TSL 4. Implementing inlet air preheat for electric

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standard dryers would represent a major overhaul of existing product lines and

manufacturing facilities.

2. Annualized Benefits and Costs of the Adopted Standards

The benefits and costs of the adopted standards can also be expressed in terms of

annualized values. The annualized net benefit is (1) the annualized national economic

value (expressed in 2022$) of the benefits from operating products that meet the adopted

standards (consisting primarily of operating cost savings from using less energy), minus

increases in product purchase costs, and (2) the annualized monetary value of the climate

and health benefits.

Table V.45 shows the annualized values for consumer clothes dryers under the

Recommended TSL, expressed in 2022$. The results under the primary estimate are as

follows.

Using a 7-percent discount rate for consumer benefits and costs and NO

and SO

reductions, and the 3-percent discount rate case for GHG social costs, the estimated cost

of the adopted standards for consumer clothes dryers is $60.0 million per year in

increased equipment installed costs, while the estimated annual benefits are $971.4

million from reduced equipment operating costs, $185.5 million in GHG reductions, and

$259.9 million from reduced NO

and SO

emissions. In this case, the net benefit

amounts to $1,357 million per year.

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Using a 3-percent discount rate for all benefits and costs, the estimated cost of the

adopted standards for consumer clothes dryers is $57.2 million per year in increased

equipment costs, while the estimated annual benefits are $1,177 million in reduced

operating costs, $185.5 million from GHG reductions, and $349.4 million from reduced

and SO

emissions. In this case, the net benefit amounts to $1,654 million per year.

Table V.45 Annualized Monetized Benefits and Costs of Energy Conservation

Standards for Consumer Clothes Dryers (the Recommended TSL)

Million 2022$/year

Primary

Estimate

Low-Net-

Benefits

Estimate

High-Net-

Benefits

Estimate

3% discount rate

Consumer Operating Cost Savings 1,177 1,103 1,230

Climate Benefits* 185.5 178.9 187.8

Health Benefits** 349.4 337.2 353.7

Total Benefits† 1,712 1,619 1,771

Consumer Incremental Product

Costs‡

57.2 58.9 54.4

Net Benefits 1,654 1,560 1,717

Change in Producer Cashflow

(INPV

‡‡

)

(12) – (10) (12) – (10) (12) – (10)

7% discount rate

Consumer Operating Cost Savings 971.4 915.5 1,014

Climate Benefits* 185.5 178.9 187.8

Health Benefits** 259.9 251.5 262.8

Total Benefits† 1,417 1,346 1,464

Consumer Incremental Product

Costs‡

60.0 61.2 57.7

Net Benefits 1,357 1,285 1,407

Change in Producer Cashflow

(INPV‡‡)

(12) – (10) (12) – (10) (12) – (10)

Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2028−2057. These

results include benefits to consumers which accrue after 2057 from the products shipped in 2028−2057. The Primary,

Low-Net-Benefits, and High-Net-Benefits estimates utilize projections of energy prices from the AEO2023 Reference

case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental equipment

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costs reflect a medium decline rate in the Primary Estimate, a constant rate in the Low-Net-Benefits Estimate, and a

high decline rate in the High-Net-Benefits Estimate. The methods used to derive projected price trends are explained in

sections IV.F.1 and IV.H.3 of this document. Note that the Benefits and Costs may not sum to the Net Benefits due to

rounding.

* Climate benefits are calculated using four different estimates of the global SC-GHG (see section IV.L of this

document). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3-

percent discount rate are shown, but DOE does not have a single central SC-GHG point estimate, and it emphasizes the

importance and value of considering the benefits calculated using all four sets of SC-GHG estimates. To monetize the

benefits of reducing GHG emissions, this analysis uses the interim estimates presented in the Technical Support

Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates Under Executive Order 13990

published in February 2021 by the IWG.

** Health benefits are calculated using benefit-per-ton values for NO

and SO

. DOE is currently only monetizing (for

and NO

) PM

2.5

precursor health benefits and (for NO

) ozone precursor health benefits, but will continue to

assess the ability to monetize other effects such as health benefits from reductions in direct PM

2.5

emissions. See

section IV.L of this document for more details.

† Total benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-percent

discount rate, but DOE does not have a single central SC-GHG point estimate.

‡ Costs include incremental equipment costs as well as installation costs.

‡‡ Operating Cost Savings are calculated based on the life cycle costs analysis and national impact analysis as

discussed in detail below. See sections IV.F and IV.H of this document. DOE’s NIA includes all impacts (both costs

and benefits) along the distribution chain beginning with the increased costs to the manufacturer to manufacture the

product and ending with the increase in price experienced by the consumer. DOE also separately conducts a detailed

analysis on the impacts on manufacturers (the MIA). See section IV.J of this document and chapter 12 of the direct

final rule TSD. In the detailed MIA, DOE models manufacturers’ pricing decisions based on assumptions regarding

investments, conversion costs, cashflow, and margins. The MIA produces a range of impacts, which is the rule’s

expected impact on the INPV. The change in INPV is the present value of all changes in industry cash flow, including

changes in production costs, capital expenditures, and manufacturer profit margins. The annualized change in INPV is

calculated using the industry weighted average cost of capital value of 7.5 percent that is estimated in the manufacturer

impact analysis (see chapter 12 of the direct final rule TSD for a complete description of the industry weighted average

cost of capital). For consumer clothes dryers, those values are -$12 million to -$10 million. DOE accounts for that

range of likely impacts in analyzing whether a TSL is economically justified. See section V.C of this document. DOE is

presenting the range of impacts to the INPV under two manufacturer markup scenarios: the Preservation of Gross

Margin scenario, which is the manufacturer markup scenario used in the calculation of Consumer Operating Cost

Savings in this table, and the Preservation of Operating Profit scenario, where DOE assumed manufacturers would not

be able to increase per-unit operating profit in proportion to increases in manufacturer production costs. DOE includes

the range of estimated annualized change in INPV in the above table, drawing on the MIA explained further in chapter

12 of the direct final rule TSD, to provide additional context for assessing the estimated impacts of this direct final rule

to society, including potential changes in production and consumption, which is consistent with OMB’s Circular A-4

and E.O. 12866. If DOE were to include the INPV into the annualized net benefit calculation for this direct final rule,

the annualized net benefits, using the primary estimate, would range from $1,642 million to $,1644 million at 3-percent

discount rate and would range from $1,345 million to $1,347 million at 7-percent discount rate. Parentheses () indicate

negative values.

VI. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866, 13563 and 14094

Executive Order (“E.O.”) 12866, “Regulatory Planning and Review,” as

supplemented and reaffirmed by E.O. 13563, “Improving Regulation and Regulatory

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Review,” 76 FR 3821 (Jan. 21, 2011) and amended by E.O. 14094, “Modernizing

Regulatory Review,” 88 FR 21879 (April 11, 2023), requires agencies, to the extent

permitted by law, to (1) propose or adopt a regulation only upon a reasoned

determination that its benefits justify its costs (recognizing that some benefits and costs

are difficult to quantify); (2) tailor regulations to impose the least burden on society,

consistent with obtaining regulatory objectives, taking into account, among other things,

and to the extent practicable, the costs of cumulative regulations; (3) select, in choosing

among alternative regulatory approaches, those approaches that maximize net benefits

(including potential economic, environmental, public health and safety, and other

advantages; distributive impacts; and equity); (4) to the extent feasible, specify

performance objectives, rather than specifying the behavior or manner of compliance that

regulated entities must adopt; and (5) identify and assess available alternatives to direct

regulation, including providing economic incentives to encourage the desired behavior,

such as user fees or marketable permits, or providing information upon which choices can

be made by the public. DOE emphasizes as well that E.O. 13563 requires agencies to use

the best available techniques to quantify anticipated present and future benefits and costs

as accurately as possible. In its guidance, the Office of Information and Regulatory

Affairs (“OIRA”) in the Office of Management and Budget (“OMB”) has emphasized

that such techniques may include identifying changing future compliance costs that might

result from technological innovation or anticipated behavioral changes. For the reasons

stated in the preamble, this final regulatory action is consistent with these principles.

Section 6(a) of E.O. 12866 also requires agencies to submit “significant

regulatory actions” to OIRA for review. OIRA has determined that this final regulatory

267

action constitutes a “significant regulatory action” within the scope of section 3(f) of E.O.

12866. DOE has provided to OIRA an assessment, including the underlying analysis, of

benefits and costs anticipated from the final regulatory action, together with, to the extent

feasible, a quantification of those costs; and an assessment, including the underlying

analysis, of costs and benefits of potentially effective and reasonably feasible alternatives

to the planned regulation, and an explanation why the planned regulatory action is

preferable to the identified potential alternatives. These assessments are summarized in

this preamble and further detail can be found in the technical support document for this

rulemaking.

B. Review Under the Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires preparation of an

initial regulatory flexibility analysis (“IRFA”) and a final regulatory flexibility analysis

(“FRFA”) for any rule that by law must be proposed for public comment, unless the

agency certifies that the rule, if promulgated, will not have a significant economic impact

on a substantial number of small entities. As required by E.O. 13272, “Proper

Consideration of Small Entities in Agency Rulemaking,” 67 FR 53461 (Aug. 16, 2002),

DOE published procedures and policies on February 19, 2003, to ensure that the potential

impacts of its rules on small entities are properly considered during the rulemaking

process. 68 FR 7990. DOE has made its procedures and policies available on the Office

of the General Counsel’s website (www.energy.gov/gc/office-general-counsel).

DOE is not obligated to prepare a regulatory flexibility analysis for this

rulemaking because there is not a requirement to publish a general notice of proposed

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rulemaking under the Administrative Procedure Act. See 5 U.S.C. 601(2), 603(a). As

discussed previously, DOE has determined that the Joint Agreement meets the necessary

requirements under EPCA to issue this direct final rule for energy conservation standards

for consumer clothes dryers under the procedures in 42 U.S.C. 6295(p)(4). DOE notes

that the NOPR for energy conservation standards for consumer clothes dryers published

elsewhere in this issue of the Federal Register contains a regulatory flexibility analysis.

C. Review Under the Paperwork Reduction Act

Manufacturers of consumer clothes dryers must certify to DOE that their products

comply with any applicable energy conservation standards. In certifying compliance,

manufacturers must test their products according to the DOE test procedures for

consumer clothes dryers, including any amendments adopted for those test procedures.

DOE has established regulations for the certification and recordkeeping requirements for

all covered consumer products and commercial equipment, including consumer clothes

dryers. (See generally 10 CFR part 429.) The collection-of-information requirement for

the certification and recordkeeping is subject to review and approval by OMB under the

Paperwork Reduction Act (“PRA”). This requirement has been approved by OMB under

OMB control number 1910-1400. Public reporting burden for the certification is

estimated to average 35 hours per response, including the time for reviewing instructions,

searching existing data sources, gathering and maintaining the data needed, and

completing and reviewing the collection of information.

269

Notwithstanding any other provision of the law, no person is required to respond

to, nor shall any person be subject to a penalty for failure to comply with, a collection of

information subject to the requirements of the PRA, unless that collection of information

displays a currently valid OMB Control Number.

D. Review Under the National Environmental Policy Act of 1969

Pursuant to the National Environmental Policy Act of 1969 (“NEPA”), DOE has

analyzed this rule in accordance with NEPA and DOE’s NEPA implementing regulations

(10 CFR part 1021). DOE has determined that this rule qualifies for categorical

exclusion under 10 CFR part 1021, subpart D, appendix B5.1 because it is a rulemaking

that establishes energy conservation standards for consumer products or industrial

equipment, none of the exceptions identified in B5.1(b) apply, no extraordinary

circumstances exist that require further environmental analysis, and it meets the

requirements for application of a categorical exclusion. See 10 CFR 1021.410.

Therefore, DOE has determined that promulgation of this rule is not a major Federal

action significantly affecting the quality of the human environment within the meaning of

NEPA, and does not require an environmental assessment or an environmental impact

statement.

E. Review Under Executive Order 13132

E.O. 13132, “Federalism,” 64 FR 43255 (Aug. 10, 1999), imposes certain

requirements on Federal agencies formulating and implementing policies or regulations

that preempt State law or that have federalism implications. The Executive order requires

agencies to examine the constitutional and statutory authority supporting any action that

270

would limit the policymaking discretion of the States and to carefully assess the necessity

for such actions. The Executive order also requires agencies to have an accountable

process to ensure meaningful and timely input by State and local officials in the

development of regulatory policies that have federalism implications. On March 14,

2000, DOE published a statement of policy describing the intergovernmental consultation

process it will follow in the development of such regulations. 65 FR 13735. DOE has

examined this rule and has determined that it would not have a substantial direct effect on

the States, on the relationship between the national government and the States, or on the

distribution of power and responsibilities among the various levels of government.

EPCA governs and prescribes Federal preemption of State regulations as to energy

conservation for the products that are the subject of this direct final rule. States can

petition DOE for exemption from such preemption to the extent, and based on criteria, set

forth in EPCA. (42 U.S.C. 6297) Therefore, no further action is required by Executive

Order 13132.

F. Review Under Executive Order 12988

With respect to the review of existing regulations and the promulgation of new

regulations, section 3(a) of E.O. 12988, “Civil Justice Reform,” imposes on Federal

agencies the general duty to adhere to the following requirements: (1) eliminate drafting

errors and ambiguity, (2) write regulations to minimize litigation, (3) provide a clear legal

standard for affected conduct rather than a general standard, and (4) promote

simplification and burden reduction. 61 FR 4729 (Feb. 7, 1996). Regarding the review

required by section 3(a), section 3(b) of E.O. 12988 specifically requires that Executive

agencies make every reasonable effort to ensure that the regulation (1) clearly specifies

271

the preemptive effect, if any, (2) clearly specifies any effect on existing Federal law or

regulation, (3) provides a clear legal standard for affected conduct while promoting

simplification and burden reduction, (4) specifies the retroactive effect, if any, (5)

adequately defines key terms, and (6) addresses other important issues affecting clarity

and general draftsmanship under any guidelines issued by the Attorney General. Section

3(c) of E.O. 12988 requires Executive agencies to review regulations in light of

applicable standards in section 3(a) and section 3(b) to determine whether they are met or

it is unreasonable to meet one or more of them. DOE has completed the required review

and determined that, to the extent permitted by law, this direct final rule meets the

relevant standards of E.O. 12988.

G. Review Under the Unfunded Mandates Reform Act of 1995

Title II of the Unfunded Mandates Reform Act of 1995 (“UMRA”) requires each

Federal agency to assess the effects of Federal regulatory actions on State, local, and

Tribal governments and the private sector. Public Law 104-4, Sec. 201 (codified at 2

U.S.C. 1531). For a regulatory action likely to result in a rule that may cause the

expenditure by State, local, and Tribal governments, in the aggregate, or by the private

sector of $100 million or more in any one year (adjusted annually for inflation), section

202 of UMRA requires a Federal agency to publish a written statement that estimates the

resulting costs, benefits, and other effects on the national economy. (2 U.S.C. 1532(a),

(b)) The UMRA also requires a Federal agency to develop an effective process to permit

timely input by elected officers of State, local, and Tribal governments on a “significant

intergovernmental mandate,” and requires an agency plan for giving notice and

opportunity for timely input to potentially affected small governments before establishing

272

any requirements that might significantly or uniquely affect them. On March 18, 1997,

DOE published a statement of policy on its process for intergovernmental consultation

under UMRA. 62 FR 12820. DOE’s policy statement is also available at

www.energy.gov/sites/prod/files/gcprod/documents/umra_97.pdf.

DOE has concluded that this direct final rule may require expenditures of $100

million or more in any one year by the private sector. Such expenditures may include

(1) investment in research and development and in capital expenditures by consumer

clothes dryer manufacturers in the years between the direct final rule and the compliance

date for the new standards and (2) incremental additional expenditures by consumers to

purchase higher efficiency consumer clothes dryers starting at the compliance date for the

applicable standard.

Section 202 of UMRA authorizes a Federal agency to respond to the content

requirements of UMRA in any other statement or analysis that accompanies the direct

final rule. (2 U.S.C. 1532(c)) The content requirements of section 202(b) of UMRA

relevant to a private sector mandate substantially overlap the economic analysis

requirements that apply under section 325(o) of EPCA and Executive Order 12866. This

SUPPLEMENTARY INFORMATION section and the TSD for this direct final rule

respond to those requirements.

Under section 205 of UMRA, the Department is obligated to identify and consider

a reasonable number of regulatory alternatives before promulgating a rule for which a

written statement under section 202 is required. (2 U.S.C. 1535(a)) DOE is required to

273

select from those alternatives the most cost-effective and least burdensome alternative

that achieves the objectives of the rule unless DOE publishes an explanation for doing

otherwise, or the selection of such an alternative is inconsistent with law. As required by

42 U.S.C. 6295(m), this direct final rule establishes amended energy conservation

standards for consumer clothes dryers that are designed to achieve the maximum

improvement in energy efficiency that DOE has determined to be both technologically

feasible and economically justified, as required by 6295(o)(2)(A) and 6295(o)(3)(B). A

full discussion of the alternatives considered by DOE is presented in chapter 17 of the

TSD for this direct final rule.

H. Review Under the Treasury and General Government Appropriations Act, 1999

Section 654 of the Treasury and General Government Appropriations Act, 1999

(Pub. L. 105-277) requires Federal agencies to issue a Family Policymaking Assessment

for any rule that may affect family well-being. Although this direct final rule would not

have any impact on the autonomy or integrity of the family as an institution as defined,

this rule could impact a family’s well-being. When developing a Family Policymaking

Assessment, agencies must assess whether: (1) the action strengthens or erodes the

stability or safety of the family and, particularly, the marital commitment; (2) the action

strengthens or erodes the authority and rights of parents in the education, nurture, and

supervision of their children; (3) the action helps the family perform its functions, or

substitutes governmental activity for the function; (4) the action increases or decreases

disposable income or poverty of families and children; (5) the proposed benefits of the

action justify the financial impact on the family; (6) the action may be carried out by

State or local government or by the family; and whether (7) the action establishes an

274

implicit or explicit policy concerning the relationship between the behavior and personal

responsibility of youth, and the norms of society.

DOE has considered how the proposed benefits of this rule compare to the

possible financial impact on a family (the only factor listed that is relevant to this final

rule). As part of its rulemaking process, DOE must determine whether the energy

conservation standards contained in this direct final rule are economically justified. As

discussed in section V.C.1 of this document, DOE has determined that the standards are

economically justified because the benefits to consumers far outweigh the costs to

manufacturers. Families will also see LCC savings as a result of this final rule.

Moreover, as discussed further in section IV.I of this document, DOE’s analysis

estimated that 45 percent of low-income households who have a consumer clothes dryer

would experience a net benefit and 54 percent of low-income households who have a

consumer clothes dryer would have no impact under the adopted standards. Further, the

standards will also result in climate and health benefits for families.

I. Review Under Executive Order 12630

Pursuant to E.O. 12630, “Governmental Actions and Interference with

Constitutionally Protected Property Rights,” 53 FR 8859 (March 18, 1988), DOE has

determined that this rule would not result in any takings that might require compensation

under the Fifth Amendment to the U.S. Constitution.

275

J. Review Under the Treasury and General Government Appropriations Act, 2001

Section 515 of the Treasury and General Government Appropriations Act, 2001

(44 U.S.C. 3516, note) provides for Federal agencies to review most disseminations of

information to the public under information quality guidelines established by each agency

pursuant to general guidelines issued by OMB. OMB’s guidelines were published at 67

FR 8452 (Feb. 22, 2002), and DOE’s guidelines were published at 67 FR 62446 (Oct. 7,

2002). Pursuant to OMB Memorandum M-19-15, Improving Implementation of the

Information Quality Act (April 24, 2019), DOE published updated guidelines which are

available at

www.energy.gov/sites/prod/files/2019/12/f70/DOE%20Final%20Updated%20IQA%20G

uidelines%20Dec%202019.pdf. DOE has reviewed this direct final rule under the OMB

and DOE guidelines and has concluded that it is consistent with applicable policies in

those guidelines.

K. Review Under Executive Order 13211

E.O. 13211, “Actions Concerning Regulations That Significantly Affect Energy

Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires Federal agencies to

prepare and submit to OIRA at OMB, a Statement of Energy Effects for any significant

energy action. A “significant energy action” is defined as any action by an agency that

promulgates or is expected to lead to promulgation of a final rule, and that (1) is a

significant regulatory action under Executive Order 12866, or any successor order; and

(2) is likely to have a significant adverse effect on the supply, distribution, or use of

energy, or (3) is designated by the Administrator of OIRA as a significant energy action.

For any significant energy action, the agency must give a detailed statement of any

276

adverse effects on energy supply, distribution, or use should the proposal be

implemented, and of reasonable alternatives to the action and their expected benefits on

energy supply, distribution, and use.

DOE has concluded that this regulatory action, which sets forth amended energy

conservation standards for consumer clothes dryers, is not a significant energy action

because the standards are not likely to have a significant adverse effect on the supply,

distribution, or use of energy, nor has it been designated as such by the Administrator at

OIRA. Accordingly, DOE has not prepared a Statement of Energy Effects on this direct

final rule.

L. Information Quality

On December 16, 2004, OMB, in consultation with the Office of Science and

Technology Policy (“OSTP”), issued its Final Information Quality Bulletin for Peer

Review (“the Bulletin”). 70 FR 2664 (Jan. 14, 2005). The Bulletin establishes that

certain scientific information shall be peer reviewed by qualified specialists before it is

disseminated by the Federal Government, including influential scientific information

related to agency regulatory actions. The purpose of the Bulletin is to enhance the quality

and credibility of the Government’s scientific information. Under the Bulletin, the

energy conservation standards rulemaking analyses are “influential scientific

information,” which the Bulletin defines as “scientific information the agency reasonably

can determine will have, or does have, a clear and substantial impact on important public

policies or private sector decisions.” 70 FR 2664, 2667.

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In response to OMB’s Bulletin, DOE conducted formal peer reviews of the

energy conservation standards development process and the analyses that are typically

used and prepared a report describing that peer review.

135

Generation of this report

involved a rigorous, formal, and documented evaluation using objective criteria and

qualified and independent reviewers to make a judgment as to the

technical/scientific/business merit, the actual or anticipated results, and the productivity

and management effectiveness of programs and/or projects. Because available data,

models, and technological understanding have changed since 2007, DOE has engaged

with the National Academy of Sciences to review DOE’s analytical methodologies to

ascertain whether modifications are needed to improve DOE’s analyses. DOE is in the

process of evaluating the resulting report.

136

M. Congressional Notification

As required by 5 U.S.C. 801, DOE will report to Congress on the promulgation of

this rule prior to its effective date. The report will state that the Office of Information and

Regulatory Affairs has determined that this action meets the criteria set forth in 5 U.S.C.

804(2).

135

The 2007 Energy Conservation Standards Rulemaking Peer Review Report is available at

energy.gov/eere/buildings/downloads/energy-conservation-standards-rulemaking-peer-review-report-0

(last accessed November 2021).

136

The report is available at www.nationalacademies.org/our-work/review-of-methods-for-setting-building-

and-equipment-performance-standards.

278

VII. Approval of the Office of the Secretary

The Secretary of Energy has approved publication of this direct final rule.

List of Subjects in 10 CFR Part 430

Administrative practice and procedure, Confidential business information, Energy

conservation, Household appliances, Imports, Intergovernmental relations, Reporting and

recordkeeping requirements, Small businesses.

279

Marootian

Signing Authority

This document of the Department of Energy was signed on February 29, 2024, by Jeffrey

Marootian, Principal Deputy Assistant Secretary for Energy Efficiency and Renewable

Energy, pursuant to delegated authority from the Secretary of Energy. That document

with the original signature and date is maintained by DOE. For administrative purposes

only, and in compliance with requirements of the Office of the Federal Register, the

undersigned DOE Federal Register Liaison Officer has been authorized to sign and

submit the document in electronic format for publication, as an official document of the

Department of Energy. This administrative process in no way alters the legal effect of

this document upon publication in the Federal Register.

Signed in Washington, DC, on February 29, 2024.

Jeffrey M.

Digitally signed by

Jeffrey M. Marootian

Date: 2024.02.29

14:37:30 -05'00'

Jeffrey Marootian

Principal Deputy Assistant Secretary for

Energy Efficiency and Renewable Energy

U.S. Department of Energy

280

For the reasons set forth in the preamble, DOE amends part 430 of chapter II,

subchapter D, of title 10 of the Code of Federal Regulations, as set forth below:

PART 430 - ENERGY CONSERVATION PROGRAM FOR CONSUMER

PRODUCTS

1. The authority citation for part 430 continues to read as follows:

Authority: 42 U.S.C. 6291-6309; 28 U.S.C. 2461 note.

2. Amend §430.32 by adding a new paragraph (h)(4), to read as follows:

§ 430.32 Energy and water conservation standards and their compliance dates.

* * * * *

(h) * * *

(4) Clothes dryers manufactured on or after March 1, 2028, shall have a

combined energy factor, determined in accordance with appendix D2 of this subpart, no

less than:

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Product Class

CEF

lb/kWh

(i) Electric, Standard (4.4 ft3 or greater capacity)*

3.93

(ii) Electric, Compact (120V) (less than 4.4 ft3 capacity)

4.33

(iii) Vented Electric, Compact (240V) (less than 4.4 ft3 capacity)

3.57

(iv) Vented Gas, Standard (4.4 ft3 or greater capacity)**

3.48

(v) Vented Gas, Compact (less than 4.4 ft3 capacity)

2.02

(vi) Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity)

2.68

(vii) Ventless Electric, Combination Washer-Dryer

2.33

* The energy conservation standards in this product class do not apply to Vented Electric, Standard clothes

dryers with a cycle time of less than 30 minutes, when tested according to appendix D2 in subpart B of this

part.

** The energy conservation standards in this product class do not apply to Vented Gas, Standard clothes

dryers with a cycle time of less than 30 minutes, when tested according to appendix D2 in subpart B of this

part.

* * * * *