0018-0065 Content

1722 Federal Register / Vol. 88, No.
7 / Wednesday, January 11, 2023 / Proposed Rules
DEPARTMENT OF ENERGY Postal Mail: Appliance and Mr. Matthew Ring, U.S. Department of
Equipment Standards Program, U.S. Energy, Office of the General Counsel,
10 CFR Part 431 Department of Energy, Building GC–33, 1000 Independence Avenue SW,
[EERE–2019–BT–STD–0018] Technologies Office, Mailstop EE–5B, Washington, DC 20585–0121.
1000 Independence Avenue SW, Telephone: (202) 586–2555. Email:
RIN 1904–AE12 Washington, DC 20585–0121. matthew.ring@hq.doe.gov.
Telephone: (202) 287–1445. If possible, For further information on how to
Energy Conservation Program: Energy please submit all items on a compact submit a comment, review other public
Conservation Standards for disc (‘‘CD’’), in which case it is not comments and the docket, or participate
Distribution Transformers necessary to include printed copies. in the public meeting, contact the
AGENCY: Office of Energy Efficiency and Hand Delivery/Courier: Appliance Appliance and Equipment Standards
Renewable Energy, Department of and Equipment Standards Program, U.S. Program staff at (202) 287–1445 or by
Energy. Department of Energy, Building email: ApplianceStandardsQuestions@
Technologies Office, 950 L’Enfant Plaza ee.doe.gov.
ACTION: Notice of proposed rulemaking
SW, 6th Floor, Washington, DC 20024.
and announcement of public meeting. SUPPLEMENTARY INFORMATION:
Telephone: (202) 287–1445. If possible,
SUMMARY: The Energy Policy and please submit all items on a CD, in Table of Contents
Conservation Act, as amended which case it is not necessary to include I. Synopsis of the Proposed Rule
(‘‘EPCA’’), prescribes energy printed copies. A. Benefits and Costs to Consumers
conservation standards for various No telefacsimiles (‘‘faxes’’) will be B. Impact on Manufacturers
consumer products and certain accepted. For detailed instructions on C. National Benefits and Costs
commercial and industrial equipment, submitting comments and additional 1. Liquid-Immersed Distribution
including distribution transformers. information on this process, see section Transformers
IV of this document. 2. Low-Voltage Dry-Type Distribution
EPCA also requires the U.S. Department Transformers
Docket: The docket for this activity,
of Energy (‘‘DOE’’) to periodically 3. Medium Voltage Dry-Type Distribution
which includes Federal Register
determine whether more-stringent, Transformers
notices, comments, and other
standards would be technologically D. Conclusion
supporting documents/materials, is II. Introduction
feasible and economically justified, and
available for review at A. Authority
would result in significant energy www.regulations.gov. All documents in
savings. In this notice of proposed B. Background
the docket are listed in the 1. Current Standards
rulemaking (‘‘NOPR’’), DOE proposes www.regulations.gov index. However, 2. History of Standards Rulemaking for
amended energy conservation standards not all documents listed in the index Distribution Transformers
for distribution transformers, and also may be publicly available, such as C. Deviation From Appendix A
announces a public meeting to receive information that is exempt from public III. General Discussion
comment on these proposed standards disclosure. A. Equipment Classes and Scope of
and associated analyses and results. Coverage
The docket web page can be found at B. Test Procedure
DATES: DOE will hold a public meeting www.regulations.gov/docket/EERE- C. Technological Feasibility
via webinar on Thursday, February 16, 2019-BT-STD-0018. The docket web 1. General
2023, from 1:00 p.m. to 4:00 p.m. See page contains instructions on how to 2. Maximum Technologically Feasible
section VII, ‘‘Public Participation,’’ for access all documents, including public Levels
webinar registration information, comments, in the docket. See section VII D. Energy Savings
participant instructions and information of this document for information on 1. Determination of Savings
about the capabilities available to how to submit comments through 2. Significance of Savings
webinar participants. www.regulations.gov. E. Economic Justification
EPCA requires the Attorney General 1. Specific Criteria
Comments: DOE will accept
a. Economic Impact on Manufacturers and
comments, data, and information to provide DOE a written determination Consumers
regarding this NOPR no later than of whether the proposed standard is b. Savings in Operating Costs Compared to
March 13, 2023. likely to lessen competition. The U.S. Increase in Price (LCC and PBP)
Comments regarding the likely Department of Justice Antitrust Division c. Energy Savings
competitive impact of the proposed invites input from market participants d. Lessening of Utility or Performance of
standard should be sent to the and other interested persons with views Products
Department of Justice contact listed in on the likely competitive impact of the e. Impact of Any Lessening of Competition
the ADDRESSES section on or before proposed standard. Interested persons f. Need for National Energy Conservation
may contact the Division at g. Other Factors
February 10, 2023.
2. Rebuttable Presumption
Interested persons are encouraged to energy.standards@usdoj.gov on or IV. Methodology and Discussion of Related
submit comments using the Federal before the date specified in the DATES Comments
eRulemaking Portal at section. Please indicate in the ‘‘Subject’’ A. Market and Technology Assessment
www.regulations.gov. Follow the line of your email the title and Docket 1. Scope of Coverage
instructions for submitting comments. Number of this proposed rule. a. Autotransformers
Alternatively, interested persons may FOR FURTHER INFORMATION CONTACT: b. Drive (Isolation) Transformers
submit comments, identified by docket Mr. Jeremy Dommu, U.S. Department c. Special-Impedance Transformers
lotter on DSK11XQN23PROD with PROPOSALS3
number EERE–2019–BT–STD–0018, by of Energy, Office of Energy Efficiency d. Tap Range of 20 Percent or More
e. Sealed and Nonventilated Transformers
any of the following methods: and Renewable Energy, Building
f. Step-Up Transformers
Email: Technologies Office, EE–5B, 1000 g. Uninterruptible Power Supply
DistributionTransfromers2019STD Independence Avenue SW, Washington, Transformers
0018@ee.doe.gov. Include the docket DC 20585–0121. Telephone: (202) 586– h. Voltage Specification
number EERE–2019–BT–STD–0018 in 9870. Email: ApplianceStandards i. kVA Range
the subject line of the message. Questions@ee.doe.gov. 2. Equipment Classes
VerDate Sep<11>2014 19:08 Jan 10, 2023 Jkt 259001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\11JAP3.SGM 11JAP3
Federal Register / Vol. 88, No. 7 / Wednesday, January 11, 2023 / Proposed Rules 1723
a. Pole- and Pad-Mounted Transformers 2. Utility Purchasers of Vault 6. Annualized Benefits and Costs of the
b. Submersible Transformers (Underground) and Subsurface Proposed Standards for Medium-Voltage
c. Multi-Voltage-Capable Distribution Installations Distribution Transformers
Transformers J. Manufacturer Impact Analysis 7. Benefits and Costs of the Proposed
d. High-Current Distribution Transformers 1. Overview Standards for All Considered
e. Data Center Distribution Transformer 2. Government Regulatory Impact Model Distribution Transformers
f. BIL Rating and Key Inputs D. Reporting, Certification, and Sampling
g. Other Types of Equipment a. Manufacturer Production Costs Plan
3. Test Procedure b. Shipments Projections VI. Procedural Issues and Regulatory Review
4. Technology Options c. Product and Capital Conversion Costs A. Review Under Executive Orders 12866
5. Electrical Steel Technology and Market d. Manufacturer Markup Scenarios and 13563
Assessment 3. Manufacturer Interviews B. Review Under the Regulatory Flexibility
a. Amorphous Steel Market and a. Material Shortages and Prices Act
Technology b. Use of Amorphous Materials 1. Description of Reasons Why Action Is
b. Grain-Oriented Electrical Steel Market c. Larger Distribution Transformers Being Considered
and Technology 4. Discussion of MIA Comments 2. Objectives of, and Legal Basis for, Rule
6. Distribution Transformer Production a. Small Businesses 3. Description on Estimated Number of
Market Dynamics b. Capital Equipment Small Entities Regulated
B. Screening Analysis K. Emissions Analysis 4. Description and Estimate of Compliance
1. Screened-Out Technologies 1. Air Quality Regulations Incorporated in Requirements Including Differences in
2. Remaining Technologies DOE’s Analysis Cost, if Any, for Different Groups of
C. Engineering Analysis Small Entities
L. Monetizing Emissions Impacts
1. Representative Units 5. Duplication, Overlap, and Conflict With
1. Monetization of Greenhouse Gas
2. Efficiency Analysis Other Rules and Regulations
Emissions
a. Design Option Combinations 6. Significant Alternatives to the Rule
a. Social Cost of Carbon
b. Data Validation C. Review Under the Paperwork Reduction
b. Social Cost of Methane and Nitrous
c. Baseline Energy Use Act
Oxide
d. Higher Efficiency Levels D. Review Under the National
2. Monetization of Other Emissions
e. Load Loss Scaling Environmental Policy Act of 1969
Impacts
f. kVA Scaling E. Review Under Executive Order 13132
M. Utility Impact Analysis
3. Cost Analysis F. Review Under Executive Order 12988
N. Employment Impact Analysis
a. Electrical Steel Prices G. Review Under the Unfunded Mandates
V. Analytical Results and Conclusions
b. Scrap Factor Reform Act of 1995
c. Other Material Costs A. Trial Standard Levels
H. Review Under the Treasury and General
d. Cost Mark-Ups B. Economic Justification and Energy
Government Appropriations Act, 1999
4. Cost-Efficiency Results Savings
I. Review Under Executive Order 12630
D. Markups Analysis 1. Economic Impacts on Individual
J. Review Under the Treasury and General
E. Energy Use Analysis Consumers
Government Appropriations Act, 2001
1. Hourly Load Model a. Life-Cycle Cost and Payback Period K. Review Under Executive Order 13211
a. Hourly Per-Unit Load (PUL) b. Consumer Subgroup Analysis L. Information Quality
b. Joint Probability Distribution Function c. Rebuttable Presumption Payback VII. Public Participation
(JPDF) 2. Economic Impacts on Manufacturers A. Attendance at the Public Meeting
2. Monthly Per-Unit Load (PUL) a. Industry Cash Flow Analysis Results B. Procedure for Submitting Prepared
3. Future Load Growth b. Direct Impacts on Employment General Statements for Distribution
4. Harmonic Content/Non-Linear Loads c. Impacts on Manufacturing Capacity C. Conduct of the Public Webinar
F. Life-Cycle Cost and Payback Period d. Impacts on Competition D. Submission of Comments
Analysis e. Impacts on Subgroups of Manufacturers E. Issues on Which DOE Seeks Comment
1. Equipment Cost f. Cumulative Regulatory Burden VIII. Approval of the Office of the Secretary
2. Efficiency Levels 3. National Impact Analysis
3. Modeling Distribution Transformer a. Significance of Energy Savings I. Synopsis of the Proposed Rule
Purchase Decision b. Net Present Value of Consumer Costs
The EPCA,1 (42 U.S.C. 6291–6317, as
a. Basecase Equipment Selection and Benefits
c. Indirect Impacts on Employment codified) authorizes DOE to regulate the
b. Total Owning Cost (‘‘TOC’’) and
4. Impact on Utility or Performance of energy efficiency of a number of
Evaluators
c. Non-Evaluators and First Cost Purchases Products consumer products and certain
4. Installation Costs 5. Impact of Any Lessening of Competition industrial equipment. Title III, Part B 2
5. Annual Energy Consumption 6. Need of the Nation To Conserve Energy of EPCA (42 U.S.C. 6291–6309, as
6. Electricity Prices 7. Other Factors codified), established the Energy
a. Hourly Electricity Costs 8. Summary of Economic Impacts Conservation Program for ‘‘Consumer
7. Maintenance and Repair Costs C. Conclusion Products Other Than Automobiles.’’
8. Equipment Lifetime 1. Benefits and Burdens of TSLs Title III, Part C 3 of EPCA (42 U.S.C.
9. Discount Rates Considered for Liquid-Immersed
10. Energy Efficiency Distribution in the Distribution Transformers Standards 1 All references to EPCA in this document refer
No-New-Standards Case 2. Benefits and Burdens of TSLs to the statute as amended through the Energy Act
11. Payback Period Analysis Considered for Low-Voltage Dry-Type of 2020, Public Law 116–260 (Dec. 27, 2020), which
G. Shipments Analysis Distribution Transformers Standards reflect the last statutory amendments that impact
1. Equipment Switching 3. Benefits and Burdens of TSLs Parts A and A–1 of EPCA.
2. Trends in Distribution Transformer Considered for Medium-Voltage Dry- 2 For editorial reasons, upon codification in the
Capacity (kVA) Type Distribution Transformers U.S. Code, Part B was re-designated Part A.
3 For editorial reasons, upon codification in the
H. National Impact Analysis Standards
1. Equipment Efficiency Trends 4. Annualized Benefits and Costs of the U.S. Code, Part C was re-designated Part A–1. While
EPCA includes provisions regarding distribution
2. National Energy Savings Proposed Standards for Liquid-Immersed
transformers in both Part A and Part A–1, for
3. Net Present Value Analysis Distribution Transformers administrative convenience DOE has established
I. Consumer Subgroup Analysis 5. Annualized Benefits and Costs of the the test procedures and standards for distribution
1. Utilities Serving Low Customer Proposed Standards for Low-Voltage transformers in 10 CFR part 431, Energy Efficiency
Populations Distribution Transformers Continued
1724 Federal Register / Vol. 88, No. 7 / Wednesday, January 11, 2023 / Proposed Rules
6311–6317, as codified), added by Pursuant to EPCA, any new or including new proposed energy
Public Law 95–619, Title IV, section amended energy conservation standard conservation standards (proceeding to a
411(a), established the Energy must be designed to achieve the final rule, as appropriate). (42 U.S.C.
Conservation Program for Certain maximum improvement in energy 6316(a); 42 U.S.C. 6295(m))
Industrial Equipment. The Energy efficiency that DOE determines is In accordance with these and other
Policy Act of 1992, Public Law 102–486, technologically feasible and statutory provisions discussed in this
amended EPCA and directed DOE to economically justified. (42 U.S.C. document, DOE proposes amended
prescribe energy conservation standards 6316(a); 42 U.S.C. 6295(o)(2)(A)) energy conservation standards for
for those distribution transformers for Furthermore, the new or amended distribution transformers. The proposed
which DOE determines such standards standard must result in a significant standards, which are expressed in
would be technologically feasible, conservation of energy. (42 U.S.C. efficiency as a percentage, are shown in
economically justified, and would result 6316(a); 42 U.S.C. 6295(o)(3)(B)) EPCA Table I.1 of this document. These
also provides that not later than 6 years proposed standards, if adopted, would
in significant energy savings. (42 U.S.C.
after issuance of any final rule apply to all distribution transformers
6317(a)) The Energy Policy Act of 2005,
establishing or amending a standard, listed in Table I.1, Table I.2, and Table
Public Law 109–58, amended EPCA to DOE must publish either a notice of I.3 manufactured in, or imported into,
establish energy conservation standards determination that standards for the the United States starting on the date 3
for low-voltage dry-type distribution product do not need to be amended, or years after the publication of the final
transformers. (42 U.S.C. 6295(y)) a notice of proposed rulemaking rule for this rulemaking.
TABLE I.1—PROPOSED ENERGY CONSERVATION STANDARDS FOR LOW-VOLTAGE DRY-TYPE DISTRIBUTION
TRANSFORMERS
Single-phase Three-phase
Efficiency Efficiency
kVA kVA
(%) (%)
15 ........................................................................... 98.84 15 ........................................................................... 98.72

25 ........................................................................... 98.99 30 ........................................................................... 98.93
37.5 ........................................................................ 99.09 45 ........................................................................... 99.03
50 ........................................................................... 99.14 75 ........................................................................... 99.16
75 ........................................................................... 99.24 112.5 ...................................................................... 99.24
100 ......................................................................... 99.30 150 ......................................................................... 99.29
167 ......................................................................... 99.35 225 ......................................................................... 99.36
250 ......................................................................... 99.40 300 ......................................................................... 99.41
333 ......................................................................... 99.45 500 ......................................................................... 99.48
750 ......................................................................... 99.54
1,000 ...................................................................... 99.57
TABLE I.2—PROPOSED ENERGY CONSERVATION STANDARDS FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS

kVA kVA
(%) (%)
10 ........................................................................... 98.96 15 ........................................................................... 98.92

15 ........................................................................... 99.05 30 ........................................................................... 99.06
25 ........................................................................... 99.16 45 ........................................................................... 99.13
37.5 ........................................................................ 99.24 75 ........................................................................... 99.22
50 ........................................................................... 99.29 112.5 ...................................................................... 99.29
75 ........................................................................... 99.35 150 ......................................................................... 99.33
100 ......................................................................... 99.40 225 ......................................................................... 99.38
167 ......................................................................... 99.46 300 ......................................................................... 99.42
250 ......................................................................... 99.51 500 ......................................................................... 99.48
333 ......................................................................... 99.54 750 ......................................................................... 99.52
500 ......................................................................... 99.59 1,000 ...................................................................... 99.54
667 ......................................................................... 99.62 1,500 ...................................................................... 99.58
833 ......................................................................... 99.64 2,000 ...................................................................... 99.61
2,500 ...................................................................... 99.62
3,750 ...................................................................... 99.66
5,000 ...................................................................... 99.68
Program for Certain Commercial and Industrial generally as ‘‘covered equipment’’ in this
Equipment. DOE refers to distribution transformers document.
TABLE I.3—PROPOSED ENERGY CONSERVATION STANDARDS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION

TRANSFORMERS
BIL * BIL *
20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

kVA kVA
Efficiency Efficiency Efficiency Efficiency Efficiency Efficiency
(%) (%) (%) (%) (%) (%)
15 ...................................... 98.29 98.07 .................... 15 ..................................... 97.74 97.45 ....................

25 ...................................... 98.49 98.30 .................... 30 ..................................... 98.11 97.86 ....................
37.5 ................................... 98.64 98.47 .................... 45 ..................................... 98.29 98.07 ....................
50 ...................................... 98.74 98.58 .................... 75 ..................................... 98.49 98.31 ....................
75 ...................................... 98.86 98.71 98.68 112.5 ................................ 98.67 98.52 ....................
100 .................................... 98.94 98.80 98.77 150 ................................... 98.78 98.66 ....................
167 .................................... 99.06 98.95 98.92 225 ................................... 98.94 98.82 98.71
250 .................................... 99.16 99.05 99.02 300 ................................... 99.04 98.93 98.82
333 .................................... 99.23 99.13 99.09 500 ................................... 99.18 99.09 99.00
500 .................................... 99.30 99.21 99.18 750 ................................... 99.29 99.21 99.12
667 .................................... 99.34 99.26 99.23 1,000 ................................ 99.35 99.28 99.20
833 .................................... 99.38 99.31 99.28 1,500 ................................ 99.43 99.37 99.29
2,000 ................................ 99.49 99.42 99.35
2,500 ................................ 99.52 99.47 99.40
3,750 ................................ 99.58 99.53 99.47
5,000 ................................ 99.62 99.58 99.51
* BIL means basic impulse insulation level.
A. Benefits and Costs to Consumers cases, with the exception of costs of distribution transformers.
Table I.4 presents DOE’s evaluation of representative unit 14, and the PBP is Consumers vary by transformer type; for
the monetized impacts of the proposed less than the average lifetime of medium-voltage liquid-immersed
standards on consumers of distribution distribution transformers, which is distribution transformers the term
transformers, as measured by the estimated to be 32 years (see section consumer refers to electric utilities; for
average life-cycle cost (‘‘LCC’’) savings IV.F.8 of this document). low- and medium-voltage dry-type
and the simple payback period In the context of this NOPR, the term distribution transformers the term
(‘‘PBP’’).4 The average LCC savings are consumer refers to different populations consumer refers to commercial and
positive for all equipment classes in all that purchase and bear the operating industrial entities.
TABLE I.4—IMPACTS OF PROPOSED ENERGY CONSERVATION STANDARDS ON CONSUMERS OF DISTRIBUTION
TRANSFORMERS
Average LCC Simple payback
Representative
Equipment class savings period
unit (2021$) (years)
1 ....................................................................................................................................... 1 72 16.0
1 ....................................................................................................................................... 2 131 10.1
1 ....................................................................................................................................... 3 1,029 12.2
2 ....................................................................................................................................... 4 511 11.9
2 ....................................................................................................................................... 5 1,543 13.8
2 ....................................................................................................................................... 17 6,594 15.8
12 ..................................................................................................................................... 15 * n.a. * n.a.
12 ..................................................................................................................................... 16 * n.a. * n.a.
3 ....................................................................................................................................... 6 147 11.7
4 ....................................................................................................................................... 7 564 8.9
4 ....................................................................................................................................... 8 722 11.8
6 ....................................................................................................................................... 9 887 2.4
6 ....................................................................................................................................... 10 653 11.4
8 ....................................................................................................................................... 11 226 11.9
8 ....................................................................................................................................... 12 3,051 1.1
8 ....................................................................................................................................... 18 22,797 8.1
10 ..................................................................................................................................... 13 228 12.4
10 ..................................................................................................................................... 14 ¥2,856 26.1

10 ..................................................................................................................................... 19 8,082 11.3
* No-new standards are currently being proposed for equipment class 12, ‘‘n.a’’ indicates that there are no consumer savings.
4 The average LCC savings and simple PBP refer market in the compliance year in the absence of from the consumer choice model. (see section
to consumers that are affected by a standard and are new or amended standards. The determination of IV.F.3 of this document).
measured relative to the efficiency distribution in the distribution of efficiencies in the no-new-
the no-new-standards case, which depicts the standards case is a function of the units selected
DOE’s analysis of the impacts of the without amended standards, the lifetime as discussed in section IV.L. of this
proposed standards on consumers is energy savings for liquid-immersed document. For presentational purposes,
described in section IV.F of this distribution transformers purchased in the climate benefits associated with the
document. the 30-year period that begins in the average SC–GHG at a 3-percent discount
anticipated year of compliance with the rate are $8.66 billion. DOE does not
B. Impact on Manufacturers
amended standards (2027–2056) amount have a single central SC–GHG point
The industry net present value to 8.02 quadrillion British thermal units estimate and it emphasizes the
(‘‘INPV’’) is the sum of the discounted (‘‘Btu’’), or quads.6 This represents a importance and value of considering the
cash flows to the industry from the base fleet savings of 36 percent relative to the benefits calculated using all four SC–
year through the end of the analysis energy use of these products in the case GHG estimates.10
period (2022–2056). Using a real without amended standards (referred to DOE also estimates health benefits
discount rate of 7.4 percent for liquid- as the ‘‘no-new-standards case’’). from SO2 and NOX emissions
immersed distribution transformers, The cumulative net present value reductions.11 DOE estimates the present
11.1 percent for low-voltage dry-type (‘‘NPV’’) of total consumer benefits of value of the health benefits would be
(‘‘LVDT’’) distribution transformers, and the proposed standards for distribution $4.69 billion using a 7-percent discount
9.0 percent for medium-voltage dry-type transformers ranges from 0.26 billion rate, and $15.57 billion using a 3-
(‘‘MVDT’’) distribution transformers, (2021$) (at a 7-percent discount rate) to percent discount rate.12 DOE is
DOE estimates that the INPV for 5.30 billion (2021$) (at a 3-percent currently only monetizing (for SO2 and
manufacturers of distribution discount rate). This NPV expresses the NOX) PM2.5 precursor health benefits
transformers in the case without estimated total value of future and (for NOX) ozone precursor health
amended standards is $1,384 million in operating-cost savings minus the benefits, but will continue to assess the
2021$ for liquid-immersed distribution estimated increased product costs for ability to monetize other effects such as
transformers, $194 million in 2021$ for distribution transformers purchased in health benefits from reductions in direct
LVDT distribution transformers, and 2027–2056. PM2.5 emissions.
$87 million in 2021$ for MVDT In addition, the proposed standards Table I.5 summarizes the monetized
distribution transformers. Under the for liquid-immersed distribution benefits and costs expected to result
proposed standards, the change in INPV transformers are projected to yield from the proposed standards for liquid-
is estimated to range from –18.1 percent significant environmental benefits. DOE immersed distribution transformers. In
to –10.9 percent for liquid-immersed estimates that the proposed standards the table, total benefits for both the 3-
distribution transformers which would result in cumulative emission percent and 7-percent cases are
represents a change in INPV of reductions (over the same period as for presented using the average GHG social
approximately ¥$251.3 million to energy savings) of 256.27 million metric costs with 3-percent discount rate, but
¥$151.0 million; from –31.4 percent to tons (‘‘Mt’’) 7 of carbon dioxide (‘‘CO2’’),
the Department emphasizes the
–17.2 percent for LVDT distribution 99.71 thousand tons of sulfur dioxide
importance and value of considering the
transformers, which represents a change (‘‘SO2’’), 403.57 thousand tons of
benefits calculated using all four SC–
in INPV of approximately ¥$61.0 nitrogen oxides (‘‘NOX’’), 1,846.56
GHG cases. The estimated total net
million to ¥$33.5 million; and –3.0 thousand tons of methane (‘‘CH4’’), 2.32
benefits using each of the four cases are
percent to –0.9 percent for MVDT thousand tons of nitrous oxide (‘‘N2O’’),
distribution transformers, which and 0.65 tons of mercury (‘‘Hg’’).8
DOE estimates climate benefits from a Social Cost of Carbon, Methane, and Nitrous Oxide.
represents a change in INPV of Interim Estimates Under Executive Order 13990,
approximately ¥$2.7 million to ¥$0.8 reduction in greenhouse gases (GHG) Washington, DC, February 2021. https://
million. In order to bring products into using four different estimates of the www.whitehouse.gov/wp-content/uploads/2021/02/
compliance with amended standards, it social cost of CO2 (‘‘SC–CO2’’), the TechnicalSupportDocument_
is estimated that the industry would social cost of methane (‘‘SC–CH4’’), and SocialCostofCarbonMethaneNitrousOxide.pdf.
10 On March 16, 2022, the Fifth Circuit Court of
incur total conversion costs of $270.6 the social cost of nitrous oxide (‘‘SC– Appeals (No. 22–30087) granted the federal
million for liquid-immersed distribution N2O’’). Together these represent the government’s emergency motion for stay pending
transformer, $69.4 million for LVDT social cost of GHG (SC–GHG). DOE used appeal of the February 11, 2022, preliminary
distribution transformers, and $3.1 interim SC–GHG values developed by injunction issued in Louisiana v. Biden, No. 21–cv–
an Interagency Working Group on the 1074–JDC–KK (W.D. La.). As a result of the Fifth
million for MVDT distribution Circuit’s order, the preliminary injunction is no
transformers. Social Cost of Greenhouse Gases (IWG),9 longer in effect, pending resolution of the federal
DOE’s analysis of the impacts of the government’s appeal of that injunction or a further
proposed standards on manufacturers is 6 The quantity refers to full-fuel-cycle (‘‘FFC’’) court order. Among other things, the preliminary
described in section IV.J of this energy savings. FFC energy savings includes the injunction enjoined the defendants in that case
energy consumed in extracting, processing, and from ‘‘adopting, employing, treating as binding, or
document. The analytic results of the transporting primary fuels (i.e., coal, natural gas, relying upon’’ the interim estimates of the social
manufacturer impact analysis (‘‘MIA’’) petroleum fuels), and, thus, presents a more cost of greenhouse gases—which were issued by the
are presented in section V.B.2 of this complete picture of the impacts of energy efficiency Interagency Working Group on the Social Cost of
document. standards. For more information on the FFC metric, Greenhouse Gases on February 26, 2021—to
see section IV.H.2 of this document. monetize the benefits of reducing greenhouse gas
C. National Benefits and Costs 5 7 A metric ton is equivalent to 1.1 short tons. emissions. As reflected in this rule, DOE has
Results for emissions other than CO2 are presented reverted to its approach prior to the injunction and
1. Liquid-Immersed Distribution in short tons. present monetized greenhouse gas abatement
Transformers 8 DOE calculated emissions reductions relative to benefits where appropriate and permissible under
the no-new-standards case, which reflects key law.
DOE’s analyses indicate that the assumptions in the Annual Energy Outlook 2022 11 DOE estimated the monetized value of SO and
2
proposed energy conservation standards (‘‘AEO2022’’). AEO2022 represents current federal NOX emissions reductions associated with
for liquid-immersed distribution and state legislation and final implementation of electricity savings using benefit per ton estimates
regulations as of the time of its preparation. See from the EPA. e. See section IV.L.2 of this
transformers would save a significant section IV.K of this document for further discussion document for further discussion.
amount of energy. Relative to the case of AEO2022 assumptions that effect air pollutant 12 DOE estimates the economic value of these
emissions. emissions reductions resulting from the considered
5 All monetary values in this document are 9 See Interagency Working Group on Social Cost TSLs for the purpose of complying with the
expressed in 2021 dollars. of Greenhouse Gases, Technical Support Document: requirements of Executive Order 12866.
presented in section V.B.8 of this

document.
TABLE I.5—SUMMARY OF MONETIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR
LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS (TSL 4)
Billion
($2021)
3% discount rate
Consumer Operating Cost Savings ..................................................................................................................................................... 12.77

Climate Benefits * ................................................................................................................................................................................. 8.66
Health Benefits ** ................................................................................................................................................................................. 15.57
Total Benefits † .................................................................................................................................................................................... 37.01
Consumer Incremental Product Costs ‡ .............................................................................................................................................. 7.48
Net Benefits ......................................................................................................................................................................................... 29.53
7% discount rate

Climate Benefits * (3% discount rate) .................................................................................................................................................. 8.66
Health Benefits ** ................................................................................................................................................................................. 4.69
Total Benefits † .................................................................................................................................................................................... 17.63
Net Benefits ......................................................................................................................................................................................... 13.61
This table presents the costs and benefits associated with distribution transformers shipped in 2027–2056. These results include benefits to
consumers which accrue after 2056 from the products shipped in 2027–2056.
* Climate benefits are calculated using four different estimates of the social cost of carbon (SC–CO2), methane (SC–CH4), and nitrous oxide
(SC–N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table
V.73, Table V.74, and Table V.75. Together these represent the global social cost of greenhouse gases (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, but the Department does not
have a single central SC–GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of
Appeals (No. 22–30087) granted the federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary in-
junction issued in Louisiana v. Biden, No. 21–cv–1074–JDC–KK (W.D. La.). As a result of the Fifth Circuit’s order, the preliminary injunction is no
longer in effect, pending resolution of the federal government’s appeal of that injunction or a further court order. Among other things, the prelimi-
nary injunction enjoined the defendants in that case from ‘‘adopting, employing, treating as binding, or relying upon’’ the interim estimates of the
social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February
26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to
the injunction and present monetized greenhouse gas abatement benefits where appropriate and permissible under law.
** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5 pre-
cursor health benefits and (for NOX) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as
health benefits from reductions in direct PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See sec-
tion 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, but the Department does not have a single central
SC–GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC–GHG estimates.
See Table V.69 for net benefits using all four SC–GHG estimates.
‡ Costs include incremental equipment costs as well as installation costs.
The benefits and costs of the proposed are measured for the lifetime of benefits from reduced NOx and SO2
standards can also be expressed in terms distribution transformers shipped in emissions, and the 3-percent discount
of annualized values. The monetary 2027–2056. The benefits associated with rate case for climate benefits from
values for the total annualized net reduced emissions achieved as a result reduced GHG emissions, the estimated
benefits are (1) the reduced consumer of the proposed standards are also cost of the standards proposed in this
operating costs, minus (2) the increase calculated based on the lifetime of rule is $424.8 million per year in
in product purchase prices and liquid-immersed distribution increased equipment costs, while the
installation costs, plus (3) the value of transformers shipped in 2027–2056. estimated annual benefits are $451.9
the benefits of GHG and NOX and SO2 Estimates of annualized benefits and million in reduced equipment operating
emission reductions, all annualized.13 costs of the proposed standards are costs, $497.4 million in climate benefits,
The national operating savings are shown in Table I.6. The results under and $495.3 million in health benefits. In
domestic private U.S. consumer the primary estimate are as follows.
this case. The net benefit would amount
monetary savings that occur as a result Using a 7-percent discount rate for
to $1,019.8 million per year.
of purchasing the covered products and consumer benefits and costs and health
13 To convert the time-series of costs and benefits benefits, DOE calculated a present value associated present value, DOE then calculated the fixed annual
into annualized values, DOE calculated a present with each year’s shipments in the year in which the payment over a 30-year period, starting in the
value in 2021, the year used for discounting the shipments occur (e.g., 2030), and then discounted compliance year, that yields the same present value.
NPV of total consumer costs and savings. For the the present value from each year to 2021. Using the
TABLE I.6—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR LIQUID-
IMMERSED DISTRIBUTION TRANSFORMERS (TSL 4)
Million
(2021$/year)
Category
Primary Low-net-benefits High-net-benefits
estimate estimate estimate
3% discount rate
Consumer Operating Cost Savings ............................................................................. 733.5 686.9 789.9

Climate Benefits * ......................................................................................................... 497.4 478.9 519.5
Health Benefits ** ......................................................................................................... 894.3 860.5 934.8
Total Benefits † ............................................................................................................ 2,125.3 2,026.3 2,244.2
Consumer Incremental Product Costs ‡ ...................................................................... 429.5 449.0 413.2
Net Benefits ................................................................................................................. 1,695.8 1,577.3 1,831.0
7% discount rate

Climate Benefits * (3% discount rate) .......................................................................... 497.4 478.9 519.5
Health Benefits ** ......................................................................................................... 495.3 477.9 515.3
Total Benefits † ............................................................................................................ 1,444.7 1,382.5 1,517.0
Net Benefits ................................................................................................................. 1,019.8 940.5 1,107.2
** Health benefits are calculated using benefit-per-ton values for NOX and SO2. The benefits are based on the low estimates of the monetized
value. DOE is currently only monetizing (for SOX and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits but
will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM2.5 emissions. See section IV.L of
this document for more details.
2. Low-Voltage Dry-Type Distribution fleet savings of 47 percent relative to the would result in cumulative emission
Transformers energy use of these products in the case reductions (over the same period as for
DOE’s analyses indicate that the without amended standards (referred to energy savings) of 77.57 million metric
proposed energy conservation standards as the ‘‘no-new-standards case’’). tons (‘‘Mt’’) 15 of carbon dioxide
for low-voltage dry-type distribution The cumulative net present value (‘‘CO2’’), 92.81 thousand tons of sulfur
transformers would save a significant (‘‘NPV’’) of total consumer benefits of dioxide (‘‘SO2’’), 123.44 thousand tons
amount of energy. Relative to the case the proposed standards for low-voltage of nitrogen oxides (‘‘NOX’’), 567.30
without amended standards, the lifetime dry-type distribution transformers thousand tons of methane (‘‘CH4’’), 0.70
energy savings for low-voltage dry-type ranges from 2.63 billion (2021$) (at a 7- thousand tons of nitrous oxide (‘‘N2O’’),
distribution transformers purchased in percent discount rate) to 9.63 billion and 0.19 tons of mercury (‘‘Hg’’).16
the 30-year period that begins in the (2021$) (at a 3-percent discount rate).
anticipated year of compliance with the This NPV expresses the estimated total
amended standards (2027–2056) amount value of future operating-cost savings 15 A metric ton is equivalent to 1.1 short tons.
to 2.47 quadrillion British thermal units minus the estimated increased product Results for emissions other than CO2 are presented
(‘‘Btu’’), or quads.14 This represents a costs for low-voltage dry-type in short tons.
distribution transformers purchased in 16 DOE calculated emissions reductions relative
14 The quantity refers to full-fuel-cycle (‘‘FFC’’)

2027–2056. to the no-new-standards case, which reflects key
energy savings. FFC energy savings includes the assumptions in the Annual Energy Outlook 2022
energy consumed in extracting, processing, and In addition, the proposed standards
(‘‘AEO2022’’). AEO2022 represents current federal
transporting primary fuels (i.e., coal, natural gas, for low-voltage dry-type distribution and state legislation and final implementation of
petroleum fuels), and, thus, presents a more transformers are projected to yield
complete picture of the impacts of energy efficiency regulations as of the time of its preparation. See
standards. For more information on the FFC metric, significant environmental benefits. DOE section IV.K of this document for further discussion
see section IV.H.2 of this document. estimates that the proposed standards of AEO2022 assumptions that effect air pollutant
emissions.
DOE estimates climate benefits from a central SC–GHG point estimate and it benefits from reductions in direct PM2.5
reduction in greenhouse gases (GHG) emphasizes the importance and value of emissions.
using four different estimates of the considering the benefits calculated Table I.7 summarizes the monetized
social cost of CO2 (‘‘SC–CO2’’), the using all four SC–GHG estimates.) benefits and costs expected to result
social cost of methane (‘‘SC–CH4’’), and DOE also estimates health benefits from the proposed standards for low-
the social cost of nitrous oxide (‘‘SC– voltage dry-type distribution
from SO2 and NOX emissions
N2O’’). Together these represent the transformers. In the table, total benefits
reductions.18 DOE estimates the present
social cost of GHG (SC–GHG). DOE used for both the 3-percent and 7-percent
interim SC–GHG values developed by value of the health benefits would be cases are presented using the average
an Interagency Working Group on the $1.53 billion using a 7-percent discount GHG social costs with 3-percent
Social Cost of Greenhouse Gases rate, and $4.91 billion using a 3-percent discount rate, but the Department
(IWG),17 as discussed in section IV.L of discount rate.19 DOE is currently only emphasizes the importance and value of
this document. For presentational monetizing (for SO2 and NOX) PM2.5 considering the benefits calculated
purposes, the climate benefits precursor health benefits and (for NOX) using all four SC–GHG cases. The
associated with the average SC–GHG at ozone precursor health benefits, but will estimated total net benefits using each
a 3-percent discount rate are $2.77 continue to assess the ability to of the four cases are presented in section
billion. (DOE does not have a single monetize other effects such as health V.B.8 of this document.
LOW-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS (TSL 5)
Billion
($2021)
3% discount rate

Health Benefits ** ................................................................................................................................................................................. 4.91
Total Benefits † .................................................................................................................................................................................... 21.13
Net Benefits ......................................................................................................................................................................................... 17.31
7% discount rate

Health Benefits ** ................................................................................................................................................................................. 1.53
Total Benefits † .................................................................................................................................................................................... 8.99
Net Benefits ......................................................................................................................................................................................... 6.94
Note: This table presents the costs and benefits associated with distribution transformers shipped in 2027–2056. These results include bene-
fits to consumers which accrue after 2056 from the products shipped in 2027–2056.
17 See Interagency Working Group on Social Cost TechnicalSupportDocument_SocialCostofCarbon from the EPA. See section IV.L.2 of this document
of Greenhouse Gases, Technical Support Document: MethaneNitrousOxide.pdf. for further discussion.
Social Cost of Carbon, Methane, and Nitrous Oxide. 18 DOE estimated the monetized value of SO and
2
19 DOE estimates the economic value of these
Interim Estimates Under Executive Order 13990, NOX emissions reductions associated with emissions reductions resulting from the considered
Washington, DC, February 2021. https:// electricity savings using benefit per ton estimates TSLs for the purpose of complying with the
www.whitehouse.gov/wp-content/uploads/2021/02/ requirements of Executive Order 12866.
The benefits and costs of the proposed are measured for the lifetime of low- benefits from reduced NOX and SO2
standards can also be expressed in terms voltage dry-type distribution emissions, and the 3-percent discount
of annualized values. The monetary transformers shipped in 2027–2056. The rate case for climate benefits from
values for the total annualized net benefits associated with reduced reduced GHG emissions, the estimated
benefits are (1) the reduced consumer emissions achieved as a result of the cost of the standards proposed in this
operating costs, minus (2) the increase proposed standards are also calculated rule is $216.9 million per year in
in product purchase prices and based on the lifetime of low-voltage dry- increased equipment costs, while the
installation costs, plus (3) the value of type distribution transformers shipped estimated annual benefits are $495.0
the benefits of GHG and NOX and SO2 in 2027–2056. million in reduced equipment operating
Estimates of annualized benefits and
emission reductions, all annualized.20 costs, $159.2 million in climate benefits,
costs of the proposed standards are
The national operating savings are shown in Table I.8. The results under and $162.1 million in health benefits. In
domestic private U.S. consumer the primary estimate are as follows. this case. The net benefit would amount
monetary savings that occur as a result Using a 7-percent discount rate for to $599.4 million per year.
of purchasing the covered products and consumer benefits and costs and health
TABLE I.8—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR LOW-VOLTAGE
DRY TYPE DISTRIBUTION TRANSFORMERS (TSL 5)
Million
(2021$/year)
Category
3% discount rate

Health Benefits ** ......................................................................................................... 281.8 268.3 293.9
Total Benefits † ............................................................................................................ 1,213.1 1,136.7 1,291.1
Net Benefits ................................................................................................................. 993.8 908.0 1,082.4
7% discount rate

Health Benefits ** ......................................................................................................... 162.1 154.9 168.2
Total Benefits † ............................................................................................................ 816.3 769.3 862.8
Net Benefits ................................................................................................................. 599.4 544.1 655.5
3. Medium Voltage Dry-Type for medium-voltage dry-type the lifetime energy savings for medium-
Distribution Transformers distribution transformers would save a voltage dry-type distribution

DOE’s analyses indicate that the significant amount of energy. Relative to transformers purchased in the 30-year
proposed energy conservation standards the case without amended standards, period that begins in the anticipated
year of compliance with the amended of 3.71 million metric tons (‘‘Mt’’) 22 of DOE also estimates health benefits
standards (2027–2056) amount to 0.12 carbon dioxide (‘‘CO2’’), 1.43 thousand from SO2 and NOX emissions
quadrillion British thermal units tons of sulfur dioxide (‘‘SO2’’), 5.93 reductions.25 DOE estimates the present
(‘‘Btu’’), or quads.21 This represents a thousand tons of nitrogen oxides value of the health benefits would be
fleet savings of 24 percent relative to the (‘‘NOX’’), 27.29 thousand tons of $0.07 billion using a 7-percent discount
energy use of these products in the case methane (‘‘CH4’’), 0.03 thousand tons of rate, and $0.24 billion using a 3-percent
without amended standards (referred to nitrous oxide (‘‘N2O’’), and 0.01 tons of discount rate.26 DOE is currently only
as the ‘‘no-new-standards case’’). mercury (‘‘Hg’’).23 monetizing (for SO2 and NOX) PM2.5
The cumulative net present value DOE estimates climate benefits from a precursor health benefits and (for NOX)
(‘‘NPV’’) of total consumer benefits of reduction in greenhouse gases (GHG) ozone precursor health benefits, but will
the proposed standards for medium- using four different estimates of the continue to assess the ability to
voltage dry-type distribution social cost of CO2 (‘‘SC–CO2’’), the monetize other effects such as health
transformers ranges from 0.04 billion social cost of methane (‘‘SC–CH4’’), and benefits from reductions in direct PM2.5
(2021$) (at a 7-percent discount rate) to the social cost of nitrous oxide (‘‘SC– emissions.
0.21 billion (2021$) (at a 3-percent N2O’’). Together these represent the Table I.9 summarizes the monetized
discount rate). This NPV expresses the social cost of GHG (SC–GHG). DOE used benefits and costs expected to result
estimated total value of future interim SC–GHG values developed by from the proposed standards for
operating-cost savings minus the an Interagency Working Group on the medium-voltage dry-type distribution
estimated increased product costs for Social Cost of Greenhouse Gases transformers. In the table, total benefits
medium-voltage dry-type distribution (IWG),24 as discussed in IV.L of this for both the 3-percent and 7-percent
transformers purchased in 2027–2056. document. For presentational purposes, cases are presented using the average
In addition, the proposed standards the climate benefits associated with the GHG social costs with 3-percent
for medium-voltage dry-type average SC–GHG at a 3-percent discount discount rate, but the Department
distribution transformers are projected rate are $0.13 billion. (DOE does not emphasizes the importance and value of
to yield significant environmental have a single central SC–GHG point considering the benefits calculated
benefits. DOE estimates that the estimate and it emphasizes the using all four SC–GHG cases. The
proposed standards would result in importance and value of considering the estimated total net benefits using each
cumulative emission reductions (over benefits calculated using all four SC– of the four cases are presented in section
the same period as for energy savings) GHG estimates.) V.B.8 of this document.
MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS (TSL 2)
Billion
($2021)
3% discount rate

Health Benefits ** ................................................................................................................................................................................. 0.24
Total Benefits † .................................................................................................................................................................................... 0.77
Net Benefits ......................................................................................................................................................................................... 0.58
7% discount rate

Health Benefits ** ................................................................................................................................................................................. 0.07
Total Benefits † .................................................................................................................................................................................... 0.35
Net Benefits ......................................................................................................................................................................................... 0.24
21 The quantity refers to full-fuel-cycle (‘‘FFC’’) assumptions in the Annual Energy Outlook 2022 TechnicalSupportDocument_
energy savings. FFC energy savings includes the (‘‘AEO2022’’). AEO2022 represents current federal SocialCostofCarbonMethaneNitrousOxide.pdf.
energy consumed in extracting, processing, and and state legislation and final implementation of 25 DOE estimated the monetized value of SO and
2
transporting primary fuels (i.e., coal, natural gas, regulations as of the time of its preparation. See
NOX emissions reductions associated with

petroleum fuels), and, thus, presents a more section IV.K of this document for further discussion
complete picture of the impacts of energy efficiency of AEO2022 assumptions that effect air pollutant electricity savings using benefit per ton estimates
standards. For more information on the FFC metric, emissions. from the EPA. See section IV.L.2 of this document
see section IV.H.2 of this document. 24 See Interagency Working Group on Social Cost for further discussion.
22 A metric ton is equivalent to 1.1 short tons. 26 DOE estimates the economic value of these
of Greenhouse Gases, Technical Support Document:
Results for emissions other than CO2 are presented Social Cost of Carbon, Methane, and Nitrous Oxide. emissions reductions resulting from the considered
in short tons. Interim Estimates Under Executive Order 13990, TSLs for the purpose of complying with the
23 DOE calculated emissions reductions relative Washington, DC, February 2021. https:// requirements of Executive Order 12866.
to the no-new-standards case, which reflects key www.whitehouse.gov/wp-content/uploads/2021/02/
The benefits and costs of the proposed and are measured for the lifetime of benefits from reduced NOX and SO2
standards can also be expressed in terms medium-voltage dry-type distribution emissions, and the 3-percent discount
of annualized values. The monetary transformers shipped in 2027–2056. The rate case for climate benefits from
values for the total annualized net benefits associated with reduced reduced GHG emissions, the estimated
benefits are (1) the reduced consumer emissions achieved as a result of the cost of the standards proposed in this
operating costs, minus (2) the increase proposed standards are also calculated rule is $10.8 million per year in
in product purchase prices and based on the lifetime of medium-voltage increased equipment costs, while the
installation costs, plus (3) the value of dry-type distribution transformers estimated annual benefits are $14.9
the benefits of GHG and NOX and SO2 shipped in 2027–2056. million in reduced equipment operating
Estimates of annualized benefits and
emission reductions, all annualized.27 costs, $7.6 million in climate benefits,
costs of the proposed standards are
The national operating savings are shown in Table I.10. The results under and $7.8 million in health benefits. The
domestic private U.S. consumer the primary estimate are as follows. net benefit would amount to $19.5
monetary savings that occur as a result Using a 7-percent discount rate for million per year.
of purchasing the covered equipment consumer benefits and costs and health
TABLE I.10—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR MEDIUM-
VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS (TSL 2)
Million
(2021$/year)
Category
3% discount rate

Health Benefits ** ......................................................................................................... 13.5 13.2 14.5
Total Benefits † ............................................................................................................ 44.4 42.9 48.5
Net Benefits ................................................................................................................. 33.5 31.1 37.7
7% discount rate

Health Benefits ** ......................................................................................................... 7.8 7.6 8.3
Total Benefits † ............................................................................................................ 30.3 29.4 32.9
Net Benefits ................................................................................................................. 19.5 17.9 22.2
DOE’s analysis of the national impacts with regards to technological feasibility discount rate case for GHG social costs,
of the proposed standards is described products achieving these standard levels the estimated annual cost of the
in sections IV.H, IV.K and IV.L of this are already commercially available for proposed standards for distribution
document. all product classes covered by this transformers is $652.5 million per year
D. Conclusion proposal. As for economic justification, in increased distribution transformer
DOE’s analysis shows that for each costs, while the estimated annual
DOE has tentatively concluded that
equipment class the benefits of the benefits are $961.8 million in reduced
the proposed standards represent the
proposed standards exceed the burdens distribution transformer operating costs,
maximum improvement in energy
efficiency that is technologically of the proposed standards. Using a 7- $664.2 million in climate benefits and
feasible and economically justified, and percent discount rate for consumer $665.2 million in health benefits. The
would result in the significant benefits and costs and NOX and SO2 net benefit amounts to $1,638.7 million
conservation of energy. Specifically, reduction benefits, and a 3-percent per year.
TABLE I.11—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR ALL
DISTRIBUTION TRANSFORMERS AT PROPOSED STANDARD LEVELS
Million
(2021$/year)
Category
3% discount rate
Consumer Operating Cost Savings ............................................................................. 1,528.9 1,426.0 1,647.0

Health Benefits ** ......................................................................................................... 1,189.6 1,142.0 1,243.2
Total Benefits † ............................................................................................................ 3,382.8 3,205.9 3,583.8
Net Benefits ................................................................................................................. 2,723.1 2,516.4 2,951.1
7% discount rate
Consumer Operating Cost Savings ............................................................................. 961.8 902.8 1,027.3

Health Benefits ** ......................................................................................................... 665.2 640.4 691.8
Total Benefits † ............................................................................................................ 2,291.3 2,181.2 2,412.7
Net Benefits ................................................................................................................. 1,638.7 1,502.5 1,784.9
Note: This table presents the costs and benefits associated with distribution transformers shipped in 2027–2056. These results include bene-
fits to consumers which accrue after 2056 from the products shipped in 2027–2056.
Appeals (No. 22–30087) granted the Federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary in-
longer in effect, pending resolution of the Federal government’s appeal of that injunction or a further court order. Among other things, the prelimi-
26, 2021—to monetize the benefits of reducing greenhouse gas emissions. In the absence of further intervening court orders, DOE will revert to
its approach prior to the injunction and present monetized benefits where appropriate and permissible under law.
**Health benefits are calculated using benefit-per-ton values for NOX and SO2. The benefits are based on the low estimates of the monetized
ALL DISTRIBUTION TRANSFORMERS AT PROPOSED STANDARD LEVELS
Billion
($2021)
3% discount rate

Health Benefits ** ................................................................................................................................................................................. 20.72
Total Benefits † .................................................................................................................................................................................... 58.91
Net Benefits ......................................................................................................................................................................................... 47.42
7% discount rate

Health Benefits ** ................................................................................................................................................................................. 6.29
Total Benefits † .................................................................................................................................................................................... 26.97
Net Benefits ......................................................................................................................................................................................... 20.79
The significance of energy savings relatively constant demand. remainder of this document and the
offered by a new or amended energy Accordingly, DOE evaluates the accompanying TSD.
conservation standard cannot be significance of energy savings on a case- DOE also considered more-stringent
determined without knowledge of the by-case basis. energy efficiency levels as potential
specific circumstances surrounding a As previously mentioned, the standards, and is still considering them
given rulemaking.28 For example, some in this rulemaking. However, DOE has
standards are projected to result in
covered products and equipment, tentatively concluded that the potential
estimated national energy savings of
including distribution transformers, burdens of the more-stringent energy
have substantial energy consumption 10.60 quad. Based on the amount of FFC
savings, the corresponding reduction in efficiency levels would outweigh the
occur during periods of peak energy projected benefits.
demand. The impacts of these products GHG emissions, and need to confront
Based on consideration of the public
on the energy infrastructure can be more the global climate crisis, DOE has
initially determined the energy savings comments DOE receives in response to
pronounced than products with this document and related information
from the proposed standard levels are
collected and analyzed during the
28 Procedures, Interpretations, and Policies for ‘‘significant’’ within the meaning of 42
course of this rulemaking effort, DOE
Consideration in New or Revised Energy U.S.C. 6295(o)(3)(B). A more detailed
Conservation Standards and Test Procedures for
may adopt energy efficiency levels
discussion of the basis for these presented in this document that are
Consumer Products and Commercial/Industrial
Equipment, 86 FR 70892, 70901 (Dec. 13, 2021).
tentative conclusions is contained in the either higher or lower than the proposed
standards, or some combination of Federal energy efficiency determination after receiving comments
level(s) that incorporate the proposed requirements for covered equipment on the proposed standard, and by
standards in part. established under EPCA generally considering, to the greatest extent
supersede State laws and regulations practicable, the following seven
II. Introduction
concerning energy conservation testing, statutory factors:
The following section briefly labeling, and standards. (42 U.S.C. (1) The economic impact of the
discusses the statutory authority 6316(a) and (b); 42 U.S.C. 6297) DOE standard on manufacturers and
underlying this proposed rule, as well may, however, grant waivers of Federal consumers of the products subject to the
as some of the relevant historical preemption for particular State laws or standard;
background related to the establishment regulations, in accordance with the (2) The savings in operating costs
of standards for distribution procedures and other provisions set throughout the estimated average life of
transformers. forth under EPCA. (See 42 U.S.C. the covered products in the type (or
A. Authority 6316(a) (applying the preemption class) compared to any increase in the
waiver provisions of 42 U.S.C. 6297)) price, initial charges, or maintenance
EPCA authorizes DOE to regulate the Subject to certain criteria and expenses for the covered products that
energy efficiency of a number of conditions, DOE is required to develop are likely to result from the standard;
consumer products and certain test procedures to measure the energy (3) The total projected amount of
industrial equipment. Title III, Part B of efficiency, energy use, or estimated energy (or as applicable, water) savings
EPCA (42 U.S.C. 6291–6309, as annual operating cost of each covered likely to result directly from the
codified), established the Energy equipment. (42 U.S.C. 6316(a), 42 U.S.C. standard;
Conservation Program for ‘‘Consumer 6295(o)(3)(A) and 42 U.S.C. 6295(r)) (4) Any lessening of the utility or the
Products Other Than Automobiles.’’ Manufacturers of covered equipment performance of the covered products
Title III, Part C of EPCA (42 U.S.C. must use the Federal test procedures as likely to result from the standard;
6311–6317, as codified), added by the basis for: (1) certifying to DOE that (5) The impact of any lessening of
Public Law 95–619, Title IV, section their equipment complies with the competition, as determined in writing
411(a), established the Energy applicable energy conservation by the Attorney General, that is likely to
Conservation Program for Certain standards adopted pursuant to EPCA (42 result from the standard;
Industrial Equipment. The Energy U.S.C. 6316(a); 42 U.S.C. 6295(s)), and (6) The need for national energy and
Policy Act of 1992, Public Law 102–486, (2) making representations about the water conservation; and
amended EPCA and directed DOE to efficiency of that equipment (42 U.S.C. (7) Other factors the Secretary of
prescribe energy conservation standards 6314(d)). Similarly, DOE must use these Energy (‘‘Secretary’’) considers relevant.
for those distribution transformers for test procedures to determine whether (42 U.S.C. 6316(a); 42 U.S.C.
which DOE determines such standards the equipment complies with relevant 6295(o)(2)(B)(i)(I)–(VII))
would be technologically feasible, standards promulgated under EPCA. (42 Further, EPCA establishes a rebuttable
economically justified, and would result U.S.C. 6316(a); 42 U.S.C. 6295(s)) The presumption that a standard is
in significant energy savings. (42 U.S.C. DOE test procedures for distribution economically justified if the Secretary
6317(a)) The Energy Policy Act of 2005, transformers appear at title 10 of the finds that the additional cost to the
Public Law 109–58, amended EPCA to Code of Federal Regulations (‘‘CFR’’) consumer of purchasing a product
establish energy conservation standards part 431, subpart K, appendix A. complying with an energy conservation
for low-voltage dry-type distribution DOE must follow specific statutory standard level will be less than three
transformers. (42 U.S.C. 6295(y)) criteria for prescribing new or amended times the value of the energy savings
EPCA further provides that, not later standards for covered equipment, during the first year that the consumer
than 6 years after the issuance of any including distribution transformers. will receive as a result of the standard,
final rule establishing or amending a Any new or amended standard for a as calculated under the applicable test
standard, DOE must publish either a covered product must be designed to procedure. (42 U.S.C. 6316(a); 42 U.S.C.
notice of determination that standards achieve the maximum improvement in 6295(o)(2)(B)(iii))
for the product do not need to be energy efficiency that the Secretary of EPCA also contains what is known as
amended, or a NOPR including new Energy determines is technologically an ‘‘anti-backsliding’’ provision, which
proposed energy conservation standards feasible and economically justified. (42 prevents the Secretary from prescribing
(proceeding to a final rule, as U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(A) any amended standard that either
appropriate). (42 U.S.C. 6316(e)(1); 42 and 42 U.S.C. 6295(o)(3)(B)) increases the maximum allowable
U.S.C. 6295(m)(1)) Furthermore, DOE may not adopt any energy use or decreases the minimum
The energy conservation program standard that would not result in the required energy efficiency of a covered
under EPCA consists essentially of four significant conservation of energy. (42 product. (42 U.S.C. 6316(a); 42 U.S.C.
parts: (1) testing, (2) labeling, (3) the U.S.C. 6295(o)(3)) 6295(o)(1)) Also, the Secretary may not
establishment of Federal energy Moreover, DOE may not prescribe a prescribe an amended or new standard
conservation standards, and (4) standard: (1) for certain products, if interested persons have established by
certification and enforcement including distribution transformers, if a preponderance of the evidence that
procedures. Relevant provisions of no test procedure has been established the standard is likely to result in the
EPCA specifically include definitions for the product, or (2) if DOE determines unavailability in the United States in
(42 U.S.C. 6311; 42 U.S.C. 6291), test by rule that the standard is not any covered product type (or class) of
procedures (42 U.S.C. 6314; 42 U.S.C. technologically feasible or economically
performance characteristics (including

6293), labeling provisions (42 U.S.C. justified. (42 U.S.C. 6316(a); 42 U.S.C. reliability), features, sizes, capacities,
6315; 42 U.S.C. 6294), energy 6295(o)(3)(A)–(B)) In deciding whether a and volumes that are substantially the
conservation standards (42 U.S.C. 6313; proposed standard is economically same as those generally available in the
42 U.S.C. 6295), and the authority to justified, DOE must determine whether United States. (42 U.S.C. 6316(a); 42
require information and reports from the benefits of the standard exceed its U.S.C. 6295(o)(4))
manufacturers (42 U.S.C. 6316; 42 burdens. (42 U.S.C. 6316(a); 42 U.S.C. Additionally, EPCA specifies
U.S.C. 6296). 6295(o)(2)(B)(i)) DOE must make this requirements when promulgating an
energy conservation standard for a higher or lower standard. (42 U.S.C. B. Background
covered product that has two or more 6316(a); 42 U.S.C. 6295(q)(1)) In
product classes. DOE must specify a 1. Current Standards
determining whether a performance-
different standard level for a type or related feature justifies a different In a final rule published on April 18,
class of product that has the same standard for a group of products, DOE 2013 (‘‘April 2013 Standards Final
function or intended use, if DOE must consider such factors as the utility Rule’’), DOE prescribed the current
determines that products within such to the consumer of the feature and other energy conservation standards for
group: (A) consume a different kind of factors DOE deems appropriate. Id. Any distribution transformers manufactured
energy from that consumed by other rule prescribing such a standard must
covered products within such type (or on and after January 1, 2016. 78 FR
include an explanation of the basis on 23336, 23433. These standards are set
class); or (B) have a capacity or other
which such higher or lower level was forth in DOE’s regulations at 10 CFR
performance-related feature which other
established. (42 U.S.C. 6316(a); 42 431.196 and are repeated in Table II.1,
products within such type (or class) do
not have and such feature justifies a U.S.C. 6295(q)(2)) Table II.2, Table II.3.
TABLE II.1—FEDERAL ENERGY CONSERVATION STANDARDS FOR LOW-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS
kVA kVA
(%) (%)
15 .................................................................................. 97.70 15 ................................................................................. 97.89

25 .................................................................................. 98.00 30 ................................................................................. 98.23
37.5 ............................................................................... 98.20 45 ................................................................................. 98.40
50 .................................................................................. 98.30 75 ................................................................................. 98.60
75 .................................................................................. 98.50 112.5 ............................................................................ 98.74
100 ................................................................................ 98.60 150 ............................................................................... 98.83
167 ................................................................................ 98.70 225 ............................................................................... 98.94
250 ................................................................................ 98.80 300 ............................................................................... 99.02
333 ................................................................................ 98.90 500 ............................................................................... 99.14
750 ............................................................................... 99.23
1,000 ............................................................................ 99.28
TABLE II.2—FEDERAL ENERGY CONSERVATION STANDARDS FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS

kVA kVA
(%) (%)
10 .................................................................................. 98.70 15 ................................................................................. 98.65

15 .................................................................................. 98.82 30 ................................................................................. 98.83
25 .................................................................................. 98.95 45 ................................................................................. 98.92
37.5 ............................................................................... 99.05 75 ................................................................................. 99.03
50 .................................................................................. 99.11 112.5 ............................................................................ 99.11
75 .................................................................................. 99.19 150 ............................................................................... 99.16
100 ................................................................................ 99.25 225 ............................................................................... 99.23
167 ................................................................................ 99.33 300 ............................................................................... 99.27
250 ................................................................................ 99.39 500 ............................................................................... 99.35
333 ................................................................................ 99.43 750 ............................................................................... 99.40
500 ................................................................................ 99.49 1,000 ............................................................................ 99.43
667 ................................................................................ 99.52 1,500 ............................................................................ 99.48
833 ................................................................................ 99.55 2,000 ............................................................................ 99.51
2,500 ............................................................................ 99.52
TABLE II.3—FEDERAL ENERGY CONSERVATION STANDARDS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION

TRANSFORMERS
BIL BIL
20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

kVA kVA
(%) (%) (%) (%) (%) (%)
15 .......................... 98.1 97.86 ........................ 15 .......................... 97.5 97.18 ........................

25 .......................... 98.33 98.12 ........................ 30 .......................... 97.9 97.63 ........................
37.5 ....................... 98.49 98.3 ........................ 45 .......................... 98.1 97.86 ........................
50 .......................... 98.6 98.42 ........................ 75 .......................... 98.33 98.13 ........................
75 .......................... 98.73 98.57 98.53 112.5 ..................... 98.52 98.36 ........................
100 ........................ 98.82 98.67 98.63 150 ........................ 98.65 98.51 ........................
TABLE II.3—FEDERAL ENERGY CONSERVATION STANDARDS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION

TRANSFORMERS—Continued
BIL BIL
20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

kVA kVA
(%) (%) (%) (%) (%) (%)
167 ........................ 98.96 98.83 98.80 225 ........................ 98.82 98.69 98.57
250 ........................ 99.07 98.95 98.91 300 ........................ 98.93 98.81 98.69
333 ........................ 99.14 99.03 98.99 500 ........................ 99.09 98.99 98.89
500 ........................ 99.22 99.12 99.09 750 ........................ 99.21 99.12 99.02
667 ........................ 99.27 99.18 99.15 1,000 ..................... 99.28 99.2 99.11
833 ........................ 99.31 99.23 99.20 1,500 ..................... 99.37 99.3 99.21
2,000 ..................... 99.43 99.36 99.28
2,500 ..................... 99.47 99.41 99.33
2. History of Standards Rulemaking for the availability of its analysis for conservation standards for distribution
Distribution Transformers distribution transformers. 86 FR 48058 transformers and provided preliminary
(‘‘August 2021 Preliminary Analysis’’) discussions in response to a number of
On June 18, 2019, DOE published The purpose of the August 2021 issues raised by comments to the June
notice that it was initiating an early Preliminary Analysis was to make 2019 Early Assessment Review RFI. It
assessment review to determine whether publicly available the initial technical described the analytical methodology
any new or amended standards would and economic analyses conducted for that DOE used, and each analysis DOE
satisfy the relevant requirements of distribution transformers, and present had performed.
EPCA for a new or amended energy initial results of those analyses. DOE did
conservation standard for distribution not propose new or amended standards On November 11, 2021, DOE
transformers and a request for for distribution transformers at that published a notice reopening the
information (‘‘RFI’’). 84 FR 28239 (‘‘June time. The initial technical support comment period an additional 30 days.
2019 Early Assessment Review RFI’’). document (‘‘TSD’’) and accompanying 86 FR 63318.
On August 27, 2021, DOE published analytical spreadsheets for the August DOE received comments in response
a notification of a webinar and 2021 Preliminary Analysis provided the to the August 2021 Preliminary Analysis
availability of a preliminary technical analyses DOE undertook to examine the from the interested parties listed in
support document, which announced potential for amending energy Table II.4.
TABLE II.4—AUGUST 2021 PRELIMINARY ANALYSIS WRITTEN COMMENTS

Commenter(s) Abbreviation Docket No. Commenter type
Electric Research and Manufacturing Cooperative, Inc ........... ERMCO ................................... 45 Manufacturer.
Powersmiths, Inc ....................................................................... Powersmiths ........................... 46 Manufacturer.
Copper Development Association ............................................ CDA ........................................ 47 Trade Organization.
Schneider Electric ..................................................................... Schneider ................................ 49 Manufacturer.
National Electrical Manufacturers Association ......................... NEMA ...................................... 50 Trade Organization.
Northwest Energy Efficiency Alliance ....................................... NEEA ...................................... 51 Efficiency Organization.
Appliance Standards Awareness Project, American Council Efficiency Advocates ............... 52 Efficiency Organization.
for an Energy-Efficient Economy, Natural Resources De-
fense Council.
Metglas, Inc .............................................................................. Metglas ................................... 53 Steel Manufacturer.
Carte International, Inc ............................................................. Carte ....................................... 54 Manufacturer.
Eaton Corporation ..................................................................... Eaton ....................................... 55 Manufacturer.
Edison Electric Institute ............................................................ EEI .......................................... 56 Utilities.
Cleveland-Cliffs Steel Corporation ............................................ Cliffs ........................................ 57 Steel Manufacturer.
Greenville Electric Utility System .............................................. GEUS ...................................... 58 Utilities.
Howard Industries, Inc .............................................................. Howard .................................... 59 Manufacturer.
A parenthetical reference at the end of C. Deviation From Appendix A rulemaking. Section 6(f)(2) of appendix
a comment quotation or paraphrase In accordance with section 3(a) of 10 A specifies that the length of the public
comment period for a NOPR will vary
provides the location of the item in the CFR part 430, subpart C, appendix A
public record.29 (‘‘appendix A’’), DOE notes that it is depending upon the circumstances of
deviating from the provision in the particular rulemaking, but will not
29 The parenthetical reference provides a
appendix A regarding the NOPR stage be less than 75 calendar days. For this
reference for information located in the docket of NOPR, DOE is providing a 60-day
DOE’s rulemaking to develop energy conservation for an energy conservation standard
standards for distribution transformers. (Docket No.
comment period, as required by EPCA.
EERE–2019–BT–STD–0018, which is maintained at as follows: (commenter name, comment docket ID 42 U.S.C. 6316(a); 42 U.S.C. 6295(p). As
www.regulations.gov). The references are arranged number, page of that document). stated previously, DOE requested
comment in the June 2019 Early or more; uninterruptible power supply sections 6(b)(3)(i) and 7(b)(1) (‘‘Process
Assessment Review RFI on the technical transformer; or welding transformer. 10 Rule’’).
and economic analyses and provided CFR 431.192 After DOE has determined that
stakeholders a 45-day comment period. The scope of coverage of this particular technology options are
84 FR 28239. Additionally, DOE proposed rule is discussed in further technologically feasible, it further
provided a 75-day comment period for detail in section IV.A.1 of this evaluates each technology option in
the August 2021 Preliminary Analysis. document. light of the following additional
86 FR 48058. DOE also reopened the screening criteria: (1) practicability to
comment period for the August 2021 B. Test Procedure manufacture, install, and service; (2)
Preliminary Analysis for an additional adverse impacts on product utility or
EPCA sets forth generally applicable
30-days. 86 FR 63318. DOE has relied availability; (3) adverse impacts on
criteria and procedures for DOE’s
on many of the same analytical health or safety, and (4) unique-pathway
adoption and amendment of test proprietary technologies. 10 CFR 431.4;
assumptions and approaches as used in
procedures. (42 U.S.C. 6314(a)) Sections 6(c)(3)(ii)–(v) and 7(b)(2)–(5) of
the preliminary assessment presented in
Manufacturers of covered products must the Process Rule. Section IV.B of this
the TSD. Therefore, DOE believes a 60-
use these test procedures to certify to document discusses the results of the
day comment period is appropriate and
DOE that their product complies with screening analysis for distribution
will provide interested parties with a
energy conservation standards and to transformers, particularly the designs
meaningful opportunity to comment on
quantify the efficiency of their product. DOE considered, those it screened out,
the proposed rule.
DOE’s current energy conservation and those that are the basis for the
III. General Discussion standards for distribution transformers standards considered in this proposed
DOE developed this proposal after are expressed in terms of percentage rule. For further details on the screening
considering oral and written comments, efficiency at rated per-unit load (PUL). analysis for this proposed rule, see
data, and information from interested (See 10 CFR 431.193; 10 CFR part 431, chapter 4 of the NOPR technical support
parties that represent a variety of subpart K, appendix A (‘‘appendix A’’).) document (‘‘TSD’’).
interests. The following discussion On September 14, 2021, DOE
addresses issues raised by these published a test procedure final rule for 2. Maximum Technologically Feasible
commenters. distribution transformers that revised Levels
definitions for certain terms, updated When DOE proposes to adopt an
A. Equipment Classes and Scope of amended standard for a type or class of
provisions based on the latest versions
Coverage covered product, it must determine the
of relevant industry test standards,
When evaluating and establishing maintained PUL for the certification of maximum improvement in energy
energy conservation standards, DOE efficiency and added provisions for efficiency or maximum reduction in
divides covered products into representing efficiency at alternative energy use that is technologically
equipment classes by the type of energy PULs and reference temperatures. 89 FR feasible for such product. (42 U.S.C.
used or by capacity or other 51230 (‘‘September 2021 TP Final 6316(a); 42 U.S.C. 6295(p)(1))
performance-related features that justify Rule’’). DOE determined that the Accordingly, in the engineering
differing standards. In making a amendments to the test procedure analysis, DOE determined the maximum
determination whether a performance- adopted in the September 2021 TP Final technologically feasible (‘‘max-tech’’)
related feature justifies a different Rule do not alter the measured improvements in energy efficiency for
standard, DOE must consider such efficiency of distribution transformers or distribution transformers, using the
factors as the utility of the feature to the require retesting or recertification solely design parameters for the most efficient
consumer and other factors DOE as a result of DOE’s adoption of the products available on the market or in
determines are appropriate. (42 U.S.C. amendments to the test procedure. Id. at working prototypes. The max-tech
6316(a); 42 U.S.C. 6295(q)) 89 FR 51249. levels that DOE determined for this
The distribution transformer rulemaking are described in section
equipment classes considered in this C. Technological Feasibility IV.C.2.e of this proposed rule and in
proposed rule are discussed in further 1. General chapter 5 of the NOPR TSD.
detail in section IV.A.2 of this
document. This proposed rule covers In each energy conservation standards D. Energy Savings
distribution transformers which are rulemaking, DOE conducts a screening 1. Determination of Savings
currently defined as a transformer that analysis based on information gathered For each trial standard level (‘‘TSL’’),
(1) has an input voltage of 34.5 kV or on all current technology options and DOE projected energy savings from
less; (2) has an output voltage of 600 V prototype designs that could improve application of the TSL to distribution
or less; (3) is rated for operation at a the efficiency of the products or transformer purchased in the 30-year
frequency of 60 Hz; and (4) Has a equipment that are the subject of the period that begins in the year of
capacity of 10 kVA to 2500 kVA for rulemaking. As the first step in such an compliance with the proposed
liquid-immersed units and 15 kVA to analysis, DOE develops a list of standards (2027–2056).30 The savings
2500 kVA for dry-type units; but (5) The technology options for consideration in are measured over the entire lifetime of
term ‘‘distribution transformer’’ does consultation with manufacturers, design distribution transformers purchased in
not include a transformer that is an engineers, and other interested parties. the previous 30-year period.31 DOE
autotransformer, drive (isolation) DOE then determines which of those
transformer, grounding transformer, means for improving efficiency are 30 Each TSL is composed of specific efficiency
machine-tool (control transformer, technologically feasible. DOE considers levels for each product class. The TSLs considered
nonventilated transformer, rectified technologies incorporated in for this NOPR are described in section V.A of this
transformer, regulating transformer, commercially available products or in document. DOE conducted a sensitivity analysis
that considers impacts for products shipped in a 9-
sealed transformer, special-impedance working prototypes to be year period.
transformer, testing transformer, technologically feasible. 10 CFR 431.4; 31 Savings are determined for equipment shipped
transformer with tap range of 20 percent 10 CFR part 430, subpart C, appendix A, over the 30-year analysis period of 2027 through
quantified the energy savings energy infrastructure can be more in LCC and PBP associated with new or
attributable to each TSL as the pronounced than products with amended standards. These measures are
difference in energy consumption relatively constant demand. discussed further in the following
between each standards case and the no- Accordingly, DOE evaluates the section. For consumers in the aggregate,
new-standards case. The no-new- significance of energy savings on a case- DOE also calculates the national net
standards case represents a projection of by-case basis, taking into account the present value of the consumer costs and
energy consumption that reflects how significance of cumulative FFC national benefits expected to result from
the market for a product would likely energy savings, the cumulative FFC particular standards. DOE also evaluates
evolve in the absence of amended emissions reductions, and the need to the impacts of potential standards on
energy conservation standards. confront the global climate crisis, among identifiable subgroups of consumers
DOE used its national impact analysis other factors. Based on the amount of that may be affected disproportionately
(‘‘NIA’’) model to estimate national FFC savings, the corresponding by a standard.
energy savings (‘‘NES’’) from potential reduction in emissions, and need to
amended or new standards for confront the global climate crisis, DOE b. Savings in Operating Costs Compared
distribution transformers. The NIA has initially determined the energy To Increase in Price (LCC and PBP)
model (described in section IV.H of this savings from the proposed standard
document) calculates energy savings in levels are ‘‘significant’’ within the EPCA requires DOE to consider the
terms of site energy, which is the energy meaning of 42 U.S.C. 6316(a); 42 U.S.C. savings in operating costs throughout
directly consumed by products at the 6295(o)(3)(B). the estimated average life of the covered
locations where they are used. For product in the type (or class) compared
electricity, DOE reports national energy E. Economic Justification to any increase in the price of, or in the
savings in terms of primary energy 1. Specific Criteria initial charges for, or maintenance
savings, which is the savings in the expenses of, the covered product that
As noted previously, EPCA provides are likely to result from a standard. (42
energy that is used to generate and seven factors to be evaluated in
transmit the site electricity. DOE also U.S.C. 6316(a); 42 U.S.C.
determining whether a potential energy 6295(o)(2)(B)(i)(II)) DOE conducts this
calculates NES in terms of FFC energy conservation standard is economically
savings. The FFC metric includes the comparison in its LCC and PBP analysis.
justified. (42 U.S.C. 6316(a); 42 U.S.C.
energy consumed in extracting, 6295(o)(2)(B)(i)(I)–(VII))) The following The LCC is the sum of the purchase
processing, and transporting primary sections discuss how DOE has price of a product (including its
fuels (i.e., coal, natural gas, petroleum addressed each of those seven factors in installation) and the operating expense
fuels), and thus presents a more this rulemaking. (including energy, maintenance, and
complete picture of the impacts of repair expenditures) discounted over
energy conservation standards.32 DOE’s a. Economic Impact on Manufacturers the lifetime of the product. The LCC
approach is based on the calculation of and Consumers analysis requires a variety of inputs,
an FFC multiplier for each of the energy In determining the impacts of a such as product prices, product energy
types used by covered products or potential amended standard on consumption, energy prices,
equipment. For more information on manufacturers, DOE conducts an MIA, maintenance and repair costs, product
FFC energy savings, see section IV.H.2 as discussed in section IV.J of this lifetime, and discount rates appropriate
of this document. document. DOE first uses an annual for consumers. To account for
2. Significance of Savings cash-flow approach to determine the uncertainty and variability in specific
quantitative impacts. This step includes inputs, such as product lifetime and
To adopt any new or amended
both a short-term assessment—based on discount rate, DOE uses a distribution of
standards for a covered product, DOE
the cost and capital requirements during values, with probabilities attached to
must determine that such action would
the period between when a regulation is each value.
result in significant energy savings. (42
issued and when entities must comply The PBP is the estimated amount of
U.S.C. 6295(o)(3)(B))
The significance of energy savings with the regulation—and a long-term time (in years) it takes consumers to
offered by a new or amended energy assessment over a 30-year period. The
recover the increased purchase cost
conservation standard cannot be industry-wide impacts analyzed include
(including installation) of a more-
determined without knowledge of the (1) INPV, which values the industry on
efficient product through lower
specific circumstances surrounding a the basis of expected future cash flows,
operating costs. DOE calculates the PBP
given rulemaking.33 For example, some (2) cash flows by year, (3) changes in
by dividing the change in purchase cost
covered products and equipment have revenue and income, and (4) other
due to a more-stringent standard by the
most of their energy consumption occur measures of impact, as appropriate.
change in annual operating cost for the
during periods of peak energy demand. Second, DOE analyzes and reports the
year that standards are assumed to take
The impacts of these products on the impacts on different types of
effect.
manufacturers, including impacts on
small manufacturers. Third, DOE For its LCC and PBP analysis, DOE
2056. Distribution transformers have a maximum
lifetime of 60 years; therefore savings are considers the impact of standards on assumes that consumers will purchase
determined for equipment that survive, and accrue domestic manufacturer employment and the covered products in the first year of
savings through 2115. manufacturing capacity, as well as the compliance with new or amended
32 The FFC metric is discussed in DOE’s
potential for standards to result in plant standards. The LCC savings for the
statement of policy and notice of policy

amendment. 76 FR 51282 (Aug. 18, 2011), as closures and loss of capital investment. considered efficiency levels are
amended at 77 FR 49701 (Aug. 17, 2012). Finally, DOE takes into account calculated relative to the case that
33 The numeric threshold for determining the cumulative impacts of various DOE reflects projected market trends in the
significance of energy savings established in a final regulations and other regulatory absence of new or amended standards.
rule published on February 14, 2020 (85 FR 8626,
8670), was subsequently eliminated in a final rule
requirements on manufacturers. DOE’s LCC and PBP analysis is
published on December 12, 2021 (86 FR 70892, For individual consumers, measures discussed in further detail in section
70906). of economic impact include the changes IV.F of this document.
c. Energy Savings amended standard is economically period contemplated under the

Although significant conservation of justified. (42 U.S.C. 6316(a); 42 U.S.C. rebuttable-presumption test. In addition,
energy is a separate statutory 6295(o)(2)(B)(i)(VI)) The energy savings DOE routinely conducts an economic
requirement for adopting an energy from the proposed standards are likely analysis that considers the full range of
conservation standard, EPCA requires to provide improvements to the security impacts to consumers, manufacturers,
DOE, in determining the economic and reliability of the Nation’s energy the Nation, and the environment, as
justification of a standard, to consider system. Reductions in the demand for required under 42 U.S.C. 6316(a); 42
the total projected energy savings that electricity also may result in reduced U.S.C. 6295(o)(2)(B)(i). The results of
are expected to result directly from the costs for maintaining the reliability of this analysis serve as the basis for DOE’s
standard. (42 U.S.C. 6316(a); 42 U.S.C. the Nation’s electricity system. DOE evaluation of the economic justification
6295(o)(2)(B)(i)(III)) As discussed in conducts a utility impact analysis to for a potential standard level (thereby
section III.D of this document, DOE uses estimate how standards may affect the supporting or rebutting the results of
the NIA models to project national Nation’s needed power generation any preliminary determination of
energy savings. capacity, as discussed in section IV.M of economic justification). The rebuttable
this document. presumption payback calculation is
d. Lessening of Utility or Performance of DOE maintains that environmental discussed in section IV.F.11 of this
Products and public health benefits associated proposed rule.
In establishing product classes and in with the more efficient use of energy are
important to take into account when IV. Methodology and Discussion of
evaluating design options and the Related Comments
impact of potential standard levels, DOE considering the need for national energy
evaluates potential standards that would conservation. The proposed standards This section addresses the analyses
not lessen the utility or performance of are likely to result in environmental DOE has performed for this rulemaking
the considered products. (42 U.S.C. benefits in the form of reduced with regard to distribution transformers.
6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(IV)) emissions of air pollutants and Separate subsections address each
Based on data available to DOE, the greenhouse gases (‘‘GHGs’’) associated component of DOE’s analyses.
standards proposed in this document with energy production and use. DOE DOE used several analytical tools to
would not reduce the utility or conducts an emissions analysis to estimate the impact of the standards
performance of the products under estimate how potential standards may proposed in this document. The first
consideration in this rulemaking. affect these emissions, as discussed in tool is a model that calculates the LCC
section IV.K; the estimated emissions savings and PBP of potential amended
e. Impact of Any Lessening of impacts are reported in section V.B.6 of or new energy conservation standards.
Competition this document. DOE also estimates the The national impacts analysis uses a
EPCA directs DOE to consider the economic value of emissions reductions second model set that provides
impact of any lessening of competition, resulting from the considered TSLs, as shipments projections and calculates
as determined in writing by the discussed in section IV.L of this national energy savings and net present
Attorney General, that is likely to result document. value of total consumer costs and
from a proposed standard. (42 U.S.C. savings expected to result from potential
g. Other Factors energy conservation standards. DOE
6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(V)) It
also directs the Attorney General to In determining whether an energy uses the third spreadsheet tool, the
determine the impact, if any, of any conservation standard is economically Government Regulatory Impact Model
lessening of competition likely to result justified, DOE may consider any other (‘‘GRIM’’), to assess manufacturer
from a proposed standard and to factors that the Secretary deems to be impacts of potential standards. These
transmit such determination to the relevant. (42 U.S.C. 6316(a); 42 U.S.C. tools are available in the docket for this
Secretary within 60 days of the 6295(o)(2)(B)(i)(VII)) To the extent DOE rulemaking: www.regulations.gov/
publication of a proposed rule, together identifies any relevant information docket/EERE-2019-T-STD-0018.
with an analysis of the nature and regarding economic justification that Additionally, DOE used output from the
extent of the impact. (42 U.S.C. 6316(a); does not fit into the other categories latest version of the Energy Information
42 U.S.C. 6295(o)(2)(B)(ii)) DOE will described previously, DOE could Administration’s (‘‘EIA’s’’) Annual
transmit a copy of this proposed rule to consider such information under ‘‘other Energy Outlook (‘‘AEO’’), a widely
the Attorney General with a request that factors.’’ known energy projection for the United
the Department of Justice (‘‘DOJ’’) States, for the emissions and utility
2. Rebuttable Presumption
provide its determination on this issue. impact analyses.
DOE will publish and respond to the As set forth in 42 U.S.C.
6295(o)(2)(B)(iii), EPCA creates a A. Market and Technology Assessment
Attorney General’s determination in the
final rule. DOE invites comment from rebuttable presumption that an energy DOE develops information in the
the public regarding the competitive conservation standard is economically market and technology assessment that
impacts that are likely to result from justified if the additional cost to the provides an overall picture of the
this proposed rule. In addition, consumer of a product that meets the market for the products concerned,
stakeholders may also provide standard is less than three times the including the purpose of the products,
comments separately to DOJ regarding value of the first year’s energy savings the industry structure, manufacturers,
these potential impacts. See the resulting from the standard, as market characteristics, and technologies
calculated under the applicable DOE used in the products. This activity
ADDRESSES section for information to

send comments to DOJ. test procedure. DOE’s LCC and PBP includes both quantitative and
analyses generate values used to qualitative assessments, based primarily
f. Need for National Energy calculate the effects that proposed on publicly available information. The
Conservation energy conservation standards would subjects addressed in the market and
DOE also considers the need for have on the payback period for technology assessment for this
national energy and water conservation consumers. These analyses include, but rulemaking include (1) a determination
in determining whether a new or are not limited to, the 3-year payback of the scope of the rulemaking and
product classes, (2) manufacturers and 5) In the August 2021 Preliminary that autotransformers do not provide
industry structure, (3) existing Analysis TSD, DOE requested comment galvanic isolation and thus would be
efficiency programs, (4) shipments regarding the potential use of unlikely to be used in at least some
information, (5) market and industry autotransformers as substitutes for general-purpose applications. Based on
trends; and (6) technologies or design general-purpose distribution this feedback, DOE is not proposing to
options that could improve the energy transformers. Id. amend the exclusion of
efficiency of distribution transformers. Schneider commented that while autotransformers under the distribution
The key findings of DOE’s market voltage conversion can be done with an transformer definition. DOE will
assessment are summarized in the autotransformer, autotransformers monitor the market and may reevaluate
following sections. See chapter 3 of the cannot derive a neutral, lower source this exclusion if evidence exists to
NOPR TSD for further discussion of the impedance, or phase shift to remove support growing use of autotransformers
market and technology assessment. triplen (i.e., multiples-of-three) based on lower purchase price than
1. Scope of Coverage harmonics, meaning an autotransformer would be warranted by technical
risks sacrificing power quality if used in considerations alone.
The current definition for a place of a general-purpose distribution
distribution transformer codified in 10 b. Drive (Isolation) Transformers
transformer. (Schneider, No. 59 at p. 2)
CFR 431.192 is the following: Schneider added that because of these In the August 2021 Preliminary
Distribution transformer means a power quality concerns, Analysis TSD, DOE noted that the EPCA
transformer that—(1) Has an input autotransformers would be unlikely to definition of distribution transformers
voltage of 34.5 kV or less; (2) Has an be used in commercial buildings but excludes a transformer that is designed
output voltage of 600 V or less; (3) Is could be used in some subsegments and to be used in a special purpose
rated for operation at a 60 Hz; and (4) smaller commercial jobs—a possibility application and is unlikely to be used in
Has a capacity of 10 kVA to 2500 kVA supported by manufacturers’ adding general purpose applications, such as a
for liquid-immersed units and 15 kVA autotransformers to standard product drive transformer. (42 U.S.C.
to 2500 kVA for dry-type units; but (5) catalogs. (Schneider, No. 49 at p. 2) 6291(35)(b)(ii)) DOE stated that it did
The term ‘‘distribution transformer’’ Schneider commented that it not have any data indicating that ‘‘drive
does not include a transformer that is recommends autotransformers in isolation transformers’’ were being
an—(i) Autotransformer; (ii) Drive
subsegments that require wye-wye widely used in generally purpose
(isolation) transformer; (iii) Grounding
connections 35 and that segment is applications and as such, considered
transformer; (iv) Machine-tool (control)
growing and will continue to grow if them statutorily excluded. DOE
transformer; (v) Nonventilated
autotransformers remain exempt. requested comment and data as to the
transformer; (vi) Rectifier transformer;
(Schneider, No. 49 at p. 2) Schneider extent to which ‘‘drive isolation
(vii) Regulating transformer; (viii)
commented that that are no technical transformers’’ are used in generally
Sealed transformer; (ix) Special-
limitations for autotransformer to meet purpose applications. (August 2021
impedance transformer; (x) Testing
standards and asserted that the Preliminary Analysis TSD at p. 2–6)
transformer; (xi) Transformer with tap
exclusion was related to how efficiency Schneider and Eaton commented that
range of 20 percent or more; (xii)
Uninterruptible power supply was calculated and tested. Schneider drive isolation transformers have
transformer; or (xiii) Welding recommended subjecting them to the historically been sold with nonstandard
transformer. current efficiency standards based on low-voltage ratings, corresponding to
DOE received several comments their nameplate kVA. (Schneider, No. 49 typical motor input voltages, and as
regarding the definition of ‘‘distribution at pp. 2–3) Schneider commented that such are unlikely to be used in general-
transformer’’ and the definitions of in typical applications (i.e., 480Y/277 purpose applications. (Schneider, No.
equipment excluded from the and 208Y/120) autotransformers would 49 at p. 3; Eaton, No. 55 at p. 3) NEMA
definition. These detailed comments are be 60 percent the size and 20–25 commented that drive isolation
discussed below. percent less expensive. In non-typical transformers are not sold in great
applications, units would be 20 percent quantities and not widely used in
a. Autotransformers the size and 50 percent less expensive. general purpose applications. (NEMA,
The EPCA definition of distribution (Schneider, No. 49 at p. 3) No. 50 at p. 3)
transformer excludes ‘‘a transformer that NEMA commented that it is not aware Schneider and Eaton commented that
is designed to be used in a special of autotransformers being used in place recently there has been some increase in
purpose application and is unlikely to of distribution transformers. (NEMA, drive isolation transformers specified as
be used in general purpose applications, No. 50 at p. 3) having either a ‘‘480Y/277’’ or ‘‘208Y/
such as . . . [an] auto-transformer . . .’’ Stakeholder comments suggest that 120’’ voltage secondary, making it more
(42 U.S.C. 6291(35)(b)(ii)) In response to there may be certain applications in difficult to ascertain whether these
comments received as part of the June which an autotransformer may be transformers are being used in general
2019 Early Assessment Review RFI that substitutable for an isolation distribution applications. (Schneider
suggested DOE include ‘‘low-voltage transformer. However, the comments No. 49 at p. 3; Eaton, No. 55 at p. 3)
autotransformers’’ within the scope of also suggest such substitution is limited Schneider commented that only 6-pulse
distribution transformers, DOE noted to specific applications (e.g., wye-wye drive isolation transformers 36 can serve
that autotransformers do not provide connections) and not common enough
galvanic isolation 34 and thus would be to be regarded as general practice. 36 Drive-isolation transformers employ rectifier
unlikely to be used in at least some Further, DOE did not receive any diodes to mitigate drive harmonics by phase
general-purpose applications. (August feedback counter to its statement in the shifting secondary voltages. The rectifier diode
results in two pulses per phase. In a standard three-
2021 Preliminary Analysis TSD at p. 2– August 2021 Preliminary Analysis TSD phase, drive-isolation transformer, application of a
rectifier would result in 6-pulses, two per 120°
34 i.e., autotransformers contain a continuous, 35 Wye connection refers to four distribution phase shift. If additional harmonic mitigation is
current-carrying electrical pathway that ‘‘isolation’’ transformer terminals, three of which are connected needed, additional secondary windings are added
transformers do not, which is perceived as a safety to one power phase and the fourth connected to all with differing connections phase shifted from one
compromise in some applications. three power phases. Continued
general purpose applications. either 208Y/120 or 480Y/277 voltage, DOE is unable to similarly conclude that
(Schneider, No. 49 at p. 4) Eaton added and therefore the overwhelming these transformers are used in special
that there is a minor concern that majority of general-purpose distribution purpose applications. Comments by
consumers will increasingly discover transformers have a secondary voltage Eaton and Schneider confirm that while
that drive isolation transformers can be rating that is one of these standard these transformers are not sold in great
used in certain general-purpose voltage ratings. Drive-isolation numbers, they are significantly more
applications, putting manufacturers in transformers, by contrast, are not likely to be used in general purpose
the position of suspecting but not being designed to power the majority of distribution applications. As such, DOE
able to ascertain circumvention without equipment. Rather, they are designed to has tentatively determined that such
being sure of end use. (Eaton, No. 55 at work with a specific motor drive to distribution transformers are not drive
p. 3) Eaton commented that a DOE output a special purpose voltage, unique (isolation) transformers as that term
compliant general-purpose transformer to the application. As such, drive- applies to the exclusions from the
would be 16 percent more expensive isolation transformers with a rated definition of ‘‘distribution transformer.’’
than a drive isolation transformer that secondary voltage of 208Y/120 or 480Y/ In order to limit the definition of
could be used in its place, while the 277 is considerably more likely to be drive isolation transformers to
losses for the drive isolation transformer used in general purpose applications distribution transformers designed for
at 50 percent PUL were 55 percent rather than special purpose use in special purpose applications and
greater. (Eaton, No. 55 at p. 3) applications. not likely to be used in general purpose
Eaton commented that pulse count is EPCA excludes from the definition of applications, DOE proposes to amend
somewhat hard to define as it is distribution transformer certain the definition to include the criterion
generally more a function of the rectifier transformers designed to be used in an that drive isolation transformers have an
that the drive isolation transformer is application other than a general-purpose output voltage other than 208Y/120 or
connected to than the transformer itself. application. Specifically, ‘‘distribution 480Y/277. DOE may consider additional
(Eaton, No. 55 at p. 4) Eaton added that transformer’’ excludes a transformer that voltage limitations in the definition of
12-pulse and 24-pulse drive isolation is ‘‘designed to be used in a special ‘‘drive isolation transformer’’ should
transformers could, technically, be used purpose application and is unlikely to DOE determine such voltages indicate a
in general purpose applications but that be used in general purpose applications, design for use in general purpose
it would be less likely due to higher such as a drive transformer, rectifier applications.
cost. (Eaton, No. 55 at p. 3–4) transformer, auto-transformer, DOE requests comment on the
Schneider commented that 6-pulse Uninterruptible Power System proposed amendment to the definition
drive isolation transformers should be transformer, impedance transformer, of drive (isolation) transformer. DOE
included in the LVDT scope, as is regulating transformer, sealed and requests comment on its tentative
required in Canada. (Schneider, No. 49 nonventilating transformer, machine determination that voltage ratings of
at p. 4) tool transformer, welding transformer, 208Y/120 and 480Y/277 indicate a
Commenters indicated that while grounding transformer, or testing design for use in general purpose
some drive isolation transformers could, transformer[.]’’ (42 U.S.C. applications. DOE also requests
in theory be used in general purpose 6291(35)(b)(ii)) comment on other voltage ratings or
applications, no evidence exists Drive (isolation) transformers are other characteristics that would indicate
suggesting this practice is common. As defined as ‘‘a transformer that: (1) a design for use in general purpose
such, DOE has concluded that drive Isolates an electric motor from the line; applications.
isolation transformers remain an (2) Accommodates the added loads of
drive-created harmonics; and (3) Is c. Special-Impedance Transformers
example of a transformer that is
designed to be used in special purpose designed to withstand the additional Impedance is an electrical property
applications and is unlikely to be used mechanical stresses resulting from an that relates voltage across and current
in general purpose applications. Given alternating current adjustable frequency through a distribution transformer. It
that drive isolation transformers are motor drive or a direct current motor may be selected to balance voltage drop,
excluded by statute, including drive drive.’’ 10 CFR 431.192. In the product overvoltage tolerance, and compatibility
isolation transformers would first catalogs reviewed by DOE, drive- with other elements of the local
require a finding that they are being isolation transformers are frequently electrical distribution system. A
used in general purpose applications, listed at common motor voltages such as transformer built to operate outside of
which does not appear to be the case at ‘‘460Y/266’’ and ‘‘230Y/133.’’. The the normal impedance range for that
this time. listing at common motor voltages transformer’s kVA rating, as specified in
Schneider commented that drive indicates that these drive-isolation Tables 1 and 2 of 10 CFR 431.192 under
isolation transformers should only be transformers are designed for use in the definition of ‘‘special-impedance
permitted at standard motor voltages special purpose applications (i.e., transformer,’’ is excluded from the
and not standard distribution voltages. isolating an electric motor from the line) definition of ‘‘distribution transformer.’’
(Schneider, No. 49 at p. 3) and are unlikely to be used in general 10 CFR 431.192.
DOE tentatively finds, as supported purpose distribution applications, on In the August 2021 Preliminary
by comments from Schneider and Eaton, account of not aligning with general Analysis TSD, DOE requested feedback
that certain distribution transformers distribution voltages. as to the number of nonstandard kVA
that meet the current criteria of a ‘‘drive DOE has previously stated that it transformers sold and how
intends to strictly and narrowly
isolation transformers’’ are likely to be manufacturers are currently interpreting

used in general-purpose applications construe the exclusions from the the normal impedance range for
based on their voltage rating. The definition of ‘‘distribution transformer.’’ nonstandard kVA values. (August 2021
overwhelming majority of equipment in 84 FR 24972, 24979 (April 27, 2009). To Preliminary Analysis TSD at p. 2–8)
the US is designed to operate using the extent that some transformers are NEMA and Eaton recommended that
marketed as drive-isolation transformers the impedance values in Tables 1 and 2
another. Manufacturers’ sell drive-isolation but with rated output voltages aligning of 10 CFR 431.192 under the definition
transformers as 6-pulse, 12-pulse, or 24-pulse. with common distribution voltages, of ‘‘special-impedance transformer’’ be
listed as a kVA range, to remove what ‘‘distribution transformers with kVA calculations. (Eaton, No. 55 at pp. 5–6;
they stated is an ambiguity as to the ratings not appearing in the tables shall Schneider, No. 49 at pp. 5–6; NEMA,
normal impedance of non-standard have their minimum normal impedance No. 50 at p. 4)
transformer capacities (i.e., capacities and maximum normal impedance Eaton commented that nominal
not explicitly included in the tables). determined by linear interpolation of voltage is selected by the consumer but
(Eaton, No. 55 at p. 4; NEMA, No. 50 at the kVA and minimum and maximum selecting one such that it excludes a
p. 3–4) Eaton commented that there impedances, respectively, of the values product can result in 17 percent lower
were very few nonstandard kVA ratings immediately above and below that kVA costs and 73 percent higher losses at 50
for single-phase transformers and just rating.’’. This proposed approach is percent PUL. (Eaton, No. 55 at p. 6)
under one percent of three-phase consistent with the recommendation Schneider provided an example of how
transformers are rated for non-standard from Schneider. Moreover, this the nominal voltage can impact whether
kVAs. (Eaton, No. 55 at p. 4) Eaton approach is consistent with the a product is subject to standards.
added that nonstandard kVAs are quite approach specified for determining the (Schneider, No. 49 at p. 6) Eaton
common in the currently exempted required efficiency requirements of commented that of the three-phase units
step-up transformers, making up 27 distribution transformers of it has built, only one unit was built as
percent of three-phase step-up nonstandard kVA rating (i.e., using a having a tap range of 20 percent or more
transformers. (Eaton, No. 55 at p. 4) linear interpolation from the nearest while 112 units were built as DOE
Eaton stated that it currently uses the bounding kVA values listed in the compliant but could be moved out of
impedance values of the adjacent table). See 10 CFR 431.196. scope based on the choice of nominal
standard kVA ratings that result in the DOE requests comment on its voltage. (Eaton, No. 55 at pp. 6–7)
largest normal impedance range and, proposed amendment to the definition Schneider added that another
equivalently, the narrowest excluded of ‘‘special-impedance transformer’’ and complication to using nominal voltage
impedance range. (Eaton, No. 55 at p. 5) whether it provides sufficient clarity as is a new type of distribution transformer
NEMA commented that many, but not to how to treat the normal impedance that has multiple-nominal voltages.
all, customers specify the middle of the ranges for non-standard kVA (Schneider, No. 49 at p. 6–8)
normal impedance range. NEMA stated distribution transformers. Eaton supported changing how the
that some customers specify a particular Carte commented that one of its tap range is calculated to remove
impedance to compliment an customers requires higher impedance potential incentives to circumvent
application, such as for protection pole transformers, within the ‘‘normal’’ standards. (Eaton, No. 55 at p. 6) NEMA
equipment or to match better with range, but in general the larger coils and commented that it did not reach
sensitive loads. (NEMA, No. 50 at p. 4) higher core losses associated with a consensus as to how to calculate tap
Schneider commented that it receives higher impedance can be disadvantaged range. (NEMA, No. 50 at p. 4) Schneider
few requests for distribution in meeting efficiency standards. (Carte, recommended DOE establish all
transformers outside the normal No. 54 at p. 1) common system voltages as nominal
impedance range and few requests for DOE relies on the current definition of and have manufacturers justify tap
distribution transformers with ‘‘special-impedance transformer’’ in its ranges according to the relative function
nonstandard kVAs and therefore engineering analysis. DOE does not of each to the associated nominal in the
applied energy efficiency regulations to further consider impedance aside from case of multiple nominals. (Schneider,
special impedance transformers without ensuring selectable models in the No. 49 at p. 8) Schneider added that if
pursuing exemptions. (Schneider, No. analysis are within the ‘‘normal it is too difficult to establish what
49 at p. 4) Schneider added that the impedance’’ range as currently defined. nominal should be, the 20 percent tap
special impedance exemption could DOE’s analyzed higher efficiency levels, range exclusion could be removed.
potentially be removed, and thus reduce including those using amorphous steel, (Schneider, No. 49 at p. 8)
potential abuse or the normal range span a range of impedance values and While the traditional industry
could be expanded for all distribution therefore DOE has not considered understanding of tap range is in
transformers, regardless of kVA to be further separating distribution percentages relative to the nominal
from 0.5 percent to 15 percent. transformers based on impedance. voltage, stakeholder comments suggest
(Schneider, No. 49 at p. 4) As another that such a calculation can be applied
alternative, Schneider recommended d. Tap Range of 20 Percent or More differently by different manufacturers
either setting the mid-range impedance Transformers with multiple voltage such that two physically identical
as a threshold or using a linear taps, the highest of which equals at least distribution transformers can be inside
interpolation of the impedance values 20 percent more than the lowest, or outside of scope depending on the
immediately above and below that kVA computed based on the sum of the choice of nominal voltage. To have a
rating, similar to how efficiency deviations of the voltages of these taps consistent standard for physically
standards are applied for non-standard from the transformer’s nominal voltage, identical distribution transformers, DOE
kVA ratings. (Schneider, No. 49 at p. 4– are excluded from the definition of proposes to modify the calculation of
5) distribution transformers. 10 CFR tap range to only include full-power
As DOE noted in the August 2021 431.192. (See also, 42 U.S.C. capacity taps and calculate tap range
Preliminary Analysis TSD, its current 6291(35)(B)(i)) In the August 2021 based on the transformer’s maximum
values for normal impedance are based Preliminary Analysis TSD, DOE voltage rather than nominal voltage. The
on NEMA TP 2–2005. (August 2021 requested comment as to whether only amended definition would classify
transformers with tap ranges of 20
Preliminary Analysis TSD at p. 2–8) The full-power taps should count toward the
current tables in the ‘‘special-impedance exclusion and how the choice of percent or more as ‘‘a transformer with
transformer’’ definition do not explicitly nominal voltage would impact the multiple full-power voltage taps, the
address how to treat nonstandard kVA exclusion. (August 2021 Preliminary highest of which equals at least 20
values. Analysis TSD at p. 2–9) percent more than the lowest, computed
DOE is proposing to amend the In response, Schneider, NEMA and based on the sum of the deviations of
definition of ‘‘special-impedance Eaton commented that only full-power these taps from the transformer’s
transformer’’ to specify that taps should be permitted for tap range maximum full-power voltage.’’. Such a
modification would ensure that all 431.192. (See also 42 U.S.C. Eaton had no knowledge that step-up
distribution transformers capable of 6291(35)(A)(ii)) transformers were being used in
operating across a similar voltage range, DOE has acknowledged it is traditional distribution applications.
regardless of what voltage is considered technically possible to operate a step-up (Eaton, No. 55 at p. 9) Eaton stated that
nominal, are treated equally. Further, transformer in a reverse manner, by step-up voltages with common
the proposed modification removes connecting the high-voltage to the distribution high and low-voltages
ambiguity as to what customers are ‘‘output’’ winding of a step-up could possibly be operated in reverse in
using as a nominal voltage and removes transformer and the low-voltage to the distribution transformer applications.
incentives to change the nominal ‘‘input’’ winding of a step-up (Eaton, No. 55 at p. 9)
voltage to move equipment into or out transformer, such that it functions as a The comments received support
of scope of the standards. distribution transformer. 78 FR 2336, DOE’s prior statements. While step-up
DOE requests comment on its 23354. However, DOE previously had transformers could, in theory, be used in
proposed definition for transformers not identified this as a widespread distribution applications, DOE does not
with a tap range of 20 percent or more. practice. Id. In the August 2021 have any data to indicate that this is a
Preliminary Analysis TSD, DOE common or widespread practice. Eaton’s
e. Sealed and Nonventilated requested feedback as to what the
Transformers comments underscore that step-up
typical efficiency is of step-up transformers serve a separate and
As discussed, the statutory definition transformers, what fraction are being unique application, often in the
of distribution transformer excludes used in traditional distribution renewable energy field where
transformers that are designed to be transformer applications, and what are transformers designs may not be
used in a special purpose application the typical input and output voltages of optimized for the distribution market
and are unlikely to be used in general step-up transformers. (August 2021 but rather are optimized for integration
purpose applications, such as a ‘‘sealed Preliminary Analysis TSD at p. 2–18) with other equipment, such as inverters.
and nonventilating transformers.’’ (42 NEMA commented that efficiency of
Therefore, DOE is not proposing to
U.S.C. 6291(35)(b)(ii)) In the August step-up transformers is dictated by
amend the definition of ‘‘distribution
2021 Preliminary Analysis TSD, DOE customers and is sometimes above and
transformer’’ to account for step-up
noted that the definition of sealed and sometimes below DOE efficiency levels
for distribution transformers. NEMA transformers. DOE may reevaluate this
nonventilating transformers is conclusion in a future action if evidence
applicable only to dry-type added that they are not aware of step-
up transformers being used in arises to suggest step-up transformers
transformers. While liquid-immersed are being used in distribution functions.
distribution applications and they are
transformers are technically also sealed,
concerned that subjecting step-up g. Uninterruptible Power Supply
DOE has explicitly included them in the
transformers to regulation may Transformers
definition of a distribution transformer.
negatively constrain design flexibility.
10 CFR 431.92. (August 2021 ‘‘Uninterruptible power supply
(NEMA, No. 50 at p. 5)
Preliminary Analysis TSD at p. 2–7) Eaton commented that step-up transformer’’ is defined as a transformer
In response, NEMA recommended transformers are almost exclusively that is used within an uninterruptible
DOE add the words ‘‘dry-type’’ to the used in renewable energy applications power system, which in turn supplies
definition of sealed and nonventilated where low-voltages (typically less than power to loads that are sensitive to
transformers. (NEMA, No. 50 at p. 3) 700 volts) are stepped up to medium- power failure, power sags, over voltage,
DOE agrees that the proposed voltage distribution applications switching transients, line noise, and
clarification would help clarify the (typically up to 34.5 kV). Eaton added other power quality factors. 10 CFR
scope of the sealed and nonventilated that virtually all step-up transformers 431.192. An uninterruptable power
transformer exclusion and has proposed are three-phase and there are maybe a supply transformer is excluded from the
to amend the definition as such. dozen single-phase step-up transformers definition of distribution transformer.
DOE requests comment on its per year which may or may not be 42 U.S.C. 6291(35)(B)(ii); 10 CFR
proposed amendments to the definitions possible circumvention scenarios. 431.192. Such a system does not step-
of sealed and nonventilated (Eaton, No. 55 at p. 9) Eaton commented down voltage, but rather it is a
transformers. that some step-up transformer component of a power conditioning
customers specify total owning cost, device and it is used as part of the
f. Step-Up Transformers
maximum losses, or efficiency and electric supply system for sensitive
For transformers generally, the term provided a table of average efficiency of equipment that cannot tolerate system
‘‘step-up’’ refers to the function of a three-phase liquid-immersed step-up interruptions or distortions, and
transformer providing greater output transformers which showed the average counteracts such irregularities. 69 FR
voltage than input voltage. Step-up efficiency of step-up transformers 45376, 45383. DOE has clarified that
transformers primarily service energy tended to be below DOE efficiency uninterruptable power supply
producing applications, such as solar or standards. (Eaton, No. 55 at p. 9) Eaton transformers do not ‘‘supply power to’’
wind electricity generation, and input noted that many solar photovoltaic an uninterruptible power system, rather
source voltage, step-up the voltage in inverter manufacturers have been using they are ‘‘used within’’ the
the transformer, and output higher higher input voltages that often require uninterruptible power system. 72 FR
voltages that feed into the electric grid. non-standard voltages or winding 58190, 58204. This is consistent with
The definition of ‘‘distribution configurations and may decrease the reference in the definition to
transformer’’ does not explicitly exclude likelihood of a step-up transformer transformers that are ‘‘within’’ the
transformers designed for step-up being used in a distribution application. uninterruptible power system. 10 CFR
operation. (Eaton, No. 55 at p. 9) Eaton stated that 431.192. Distribution transformers at the
However, most step-up transformers 31 percent of their three-phase step-up input, output or bypass that are
have an output voltage larger than the transformers had common distribution supplying power to the uninterruptible
600 V limit specified in the distribution low-voltages, that could more easily be power system are not uninterruptable
transformer definition. See 10 CFR used in distribution applications, but power supply transformers.
In the August 2021 Preliminary DOE notes that it has previously voltage aligns with the distribution line
Analysis TSD, DOE requested comment stated that the definition of distribution voltage and implies that the intended
regarding how manufacturers are transformer applies to transformers definition of distribution transformer in
applying the definition of having an output voltage of 600 volts or EPCA was to specify the input and
uninterruptable power supply less, not having only an output voltage output voltages based on the line
transformer and whether amendments of less than 600 volts. 78 FR 23336, voltage. DOE has tentatively determined
are needed. (August 2021 Preliminary 23353. For example, a three-phase that applying the phase voltage, as DOE
Analysis TSD at p. 2–10) transformer for which the wye cited in the April 2013 Standards Final
In response, NEMA commented that connection is at or below 600 volts, but Rule, would cover products not
manufacturers are applying the the delta connection is above 600 volts traditionally understood to be
definition appropriately and would satisfy the output criteria of the distribution transformers and not
clarification is not needed. (NEMA, No. distribution transformer definition. intended to be within the scope of
50 at p. 4) Schneider recommended DOE’s test procedure requires that the distribution transformer as defined by
DOE explicitly state that transformers at measured efficiency for the purpose of EPCA. For example, a transformer with
the input, output, or by-pass of an determining compliance be based on a line voltage of 46 kV, which is
uninterruptible power system are not testing in the configuration that commonly considered in industry to be
part of the uninterruptible power system produces the greatest losses, regardless a subtransmission voltage (i.e., higher
and as such are not excluded. of whether that configuration alone than a distribution voltage), would have
(Schneider, No. 49 at p. 8). would have placed the transformer at- a phase voltage less than 34.5 kV if sold
DOE agrees that explicitly stating that large within the scope of coverage. Id. in a wye-connection. Despite this
transformers at the input, output, or Similarly with input voltages, a transformer not being considered a
bypass of a distribution transformer are transformer is subject to standards if distribution transformer by industry,
not a part of the uninterruptable power either the ‘‘line’’ or ‘‘phase’’ voltages fall interpreting DOE’s definition as either a
system would further clarify the within the voltage limits in the line or phase voltage would mean that
definition. As such, DOE is proposing to definition of distribution transformers, a 46 kV wye-connection is considered a
amend the definition to make these so long as the other requirements of the distribution transformer. As noted by
clarifications. definition are also met. Id. stakeholders, such an interpretation
Eaton commented that DOE flipped would be out of step with common
DOE requests comment on its
the usage of wye and delta in its industry practice and out of step with
proposed amendment to the definition
example where one voltage complies the intended coverage of EPCA.
of uninterruptable power supply
and the other does not because wye DOE notes that the common
transformers.
voltage should be less than delta distribution transformer voltages have
Carte asked if network transformers voltage. (Eaton, No. 55 at p. 8) DOE has
are considered uninterruptible power both line and phase voltages that are
updated its language above to correct within DOE’s scope, and therefore the
supply transformers as the network grid this.
cannot go down. (Carte, No. 54 at p. 2) proposed change is not expected to
Schneider commented that the impact the scope of this rulemaking
DOE notes that the need for a reliable industry interpretation of input and
operation does not make a distribution aside from select, unique transformers
output voltage is likely line voltage but with uncommon voltages. In this NOPR,
transformer an uninterruptible power using phase encompasses a larger scope
supply transformer. As stated, DOE is proposing to modify the
and DOE should clarify in the regulatory definition of distribution transformer to
uninterruptible power supply text. (Schneider, No. 49 at p. 8) NEMA
transformers are used within state explicitly that the input and output
commented that DOE should clarify the voltage limits are based on the ‘‘line’’
uninterruptable power systems as a interpretation of voltage in the
power conditioning device, not as a voltage and not the phase voltage. This
regulatory text. (NEMA, No. 50 at p. 4) amendment, while a slight
distribution transformer. Eaton commented that using phase reinterpretation relative to the April
h. Voltage Specification voltage would deviate from industry 2013 Standards Final Rule, better aligns
convention, but if DOE is choosing to with industry practice, minimizes
As stated, the definition of interpret language this way, it should
‘‘distribution transformer’’ is based, in confusion, and does not impact any of
explicitly say so in the regulatory text. the commonly built distribution
part, on the voltage capacity of (Eaton, No. 55 at pp. 7–8)
equipment, i.e., has an input voltage of transformer designs.
DOE notes that the voltage limits in DOE requests comment as to whether
34.5 kV or less; and has an output the definition of distribution
voltage of 600 V or less. 10 CFR 431.192. its proposed definition better aligns
transformer established in EPCA do not with industries understanding on input
(42 U.S.C. 6291(35)(A)) Three-phase specify whether line or phase voltage is
distribution transformer voltage may be and output voltages.
to be used. 42 U.S.C. 6291(35). DOE has
described as either ‘‘line’’, i.e., Further, DOE requests comment and
previously stated that a distribution
measured across two lines, or ‘‘phase’’, data on whether the proposed
transformer is required to comply if
i.e., measured across one line and the amendment would impact products that
either line or phase voltage is within the
neutral conductor. For delta- are serving distribution applications,
scope of the distribution transformer
connected 37 distribution transformers, and if so, the number of distribution
definition. 78 FR 23336, 23353. Upon
line and phase voltages are equal. For transformers impacted by the proposed
further evaluation, DOE notes that the
amendment.
wye-connected distribution distribution transformer input voltage

transformers, line voltage is equal to limitation aligns with the common
phase voltage multiplied by the square Available at www.energy.gov/sites/prod/files/2017/
maximum distribution circuit voltage of 01/f34/Electricity%20Distribution
root of three. 34.5 kV.38 39 This common distribution %20System%20Baseline%20Report.pdf.
39 U.S. Department of Energy (2015), ‘‘United
37 Delta connection refers to three distribution 38 Pacific Northwest National Lab and U.S. States Electricity Industry Primer.’’ Available at
transformer terminals, each one connected to two Department of Energy (2016), ‘‘Electricity www.energy.gov/sites/prod/files/2015/12/f28/
power phases. Distribution System Baseline Report.’’, p. 27. united-states-electricity-industry-primer.pdf.
i. kVA Range three-phase liquid-immersed purpose distribution transformers sold

The EPCA definition for distribution distribution transformers up to 3,150 above 2,500 kVA with primary and
transformers does not include any kVA.41 IEEE C57.12.90 and C57.12.91 secondary voltages that would still be
capacity range. In codifying the current cite similar short circuit tests for three- within the criteria of the definition of
distribution transformer capacity ranges phase distribution transformers up to distribution transformer. While NEMA
in 10 CFR 431.192, DOE noted that 5,000 kVA. suggested sales of models above 2,500
distribution transformers outside of In the August 2021 Preliminary kVA are small, Eaton’s comments
these ranges are not typically used for Analysis TSD, DOE requested comment suggest that at least for some
electricity distribution. 71 FR 24972, regarding the quantity and efficiency of manufacturers or markets they could be
24975–24976. Further, DOE noted that distribution transformers outside of the notable. Further, some manufacturers in
transformer capacity is to some extent kVA range of the definition of interviews expressed concern that in the
tied to its primary and secondary distribution transformer but with input presence of amended energy
voltages, meaning that the EPCA and output voltages that meet the conservation standards, there may be
definitions has the practical effect of voltage criteria in said definition. increased incentive to build distribution
limiting the maximum capacity of (August 2021 Preliminary Analysis TSD transformers that are just above the
transformers that meet those voltage at p. 2–11) existing scope (e.g., 2,501 kVA).
Regarding dry-type distribution As such, it is appropriate for DOE to
limitations to approximately 3,750 to
transformers, Schneider commented consider all distribution transformers
5,000 kVA, or possibly slightly higher.
that units below 15 kVA are typically that are serving general purpose
Id. However, DOE further stated the
sealed or non-ventilated and as such distribution applications, even if the
inclusion of capacity limitations in the would be excluded from the definition capacity of those distribution
definition of ‘‘distribution transformers’’ of distribution transformers. (Schneider,
in 10 CFR 431.192 does not mean that transformers is larger than the common
No. 49 at p. 9) Eaton commented that unit. DOE is considering multiple
DOE has concluded that the EPCA single-phase liquid immersed
definition of ‘‘distribution transformer’’ possible upper limits for distribution
distribution transformers less than 10 transformer capacity. IEEE C57.12.00–
includes such limitations and stated kVA were less than 1 percent of
that DOE intends to evaluate larger and 2015 lists the next three preferred
shipments. (Eaton, No. 55 at p. 8) continuous kVA ratings above 2,500
smaller capacities than those included DOE has not received any data or
in the definition. Id. kVA as 3,750 kVA, 5,000 kVA, and
information suggesting that expanding 7,500 kVA. Eaton’s comments suggest
DOE’s current definition of the scope of the standards below 10
distribution transformer specifies a that the upper end of their distribution
kVA for liquid-immersed distribution
capacity of 10 kVA to 2,500 kVA for capacity is 3,750 kVA. In a prior
transformers or below 15 kVA for dry-
liquid-immersed units and 15 kVA to rulemaking, stakeholders commented
type distribution transformers would
2,500 kVA for dry-type units. 10 CFR that their product lines include medium
lead to significant energy savings. As
431.192. The kVA ranges are consistent voltage dry-type models up to around
such, DOE is not proposing any changes
with NEMA publications in place at the 5,000 kVA.42 Further, NRCAN
to the lower capacity limit in the
time DOE adopted the range, regulations cover dry-type distribution
distribution transformer definition.
specifically NEMA TP–1 standard. 78 Regarding sales of distribution transformers up to 7,500 kVA but
FR 23336, 23352. DOE cited these transformers beyond the 2,500 kVA exclude distribution transformers with
documents as evidence that its kVA scope, NEMA commented that while low-voltage line currents of 4,000 amps
scope is consistent with industry there are sales of models over 2,500 or more.
understanding (i.e., NEMA TP–1 and kVA, they are not sold in significant Taken together, these points suggest
NEMA TP–2), but noted that it may numbers as compared to in-scope there are some sales of general purpose
revise its understanding in the future as products and energy savings would be distribution transformers above 2,500
the market evolves. 78 FR 23336, 23352. limited. (NEMA, No. 50 at p. 5) Eaton kVA, such as at 3,750 kVA and
Subsequent to the April 2013 Standards commented that 19.6 percent of their 5,000kVA. DOE does not have any data
Final Rule, establishing the current three-phase liquid-immersed or evidence that general purpose
energy conservation standards, NEMA transformers have input and output distribution transformers are being sold
TP–1 standard was rescinded. voltage in-scope, but kVAs above 2500 above 5,000 kVA and does have prior
As noted above, the voltage kVA. (Eaton, No. 55 at p. 8) Eaton public comment of 5,000 kVA
limitations included in EPCA provided average efficiencies for these transformers with distribution voltages
practically limit the size of distribution larger kVA distribution transformers. being sold. Therefore, DOE is proposing
transformers. However, several industry (Eaton, No. 55 at p. 8) In interviews, to expand the scope of the definition of
sources suggest that those limitations manufacturers commented that many of ‘‘distribution transformer’’ in 10 CFR
may be greater than the current 2,500 the larger distribution transformers are 431.192 for both liquid-immersed
kVA limit included in DOE’s definition serving renewable applications as step- distribution transformers and dry-type
in 10 CFR 431.192. For example, up transformers and would therefore be distribution transformers to include
Natural Resources Canada (‘‘NRCAN’’) outside the scope of the standards distribution transformers up to 5,000
regulations include three-phase dry-type regardless of the upper capacity of the kVA. DOE is also considering other
distribution transformers with a definition of distribution transformer. upper limits on the scope of distribution
nominal power of 15 to 7,500 kVA.40 However, while many larger transformer, including 3,750 kVA and
The European Union (‘‘EU’’) Ecodesign transformers may be step-up 7,500 kVA.
requirements specify maximum load transformers, stakeholder comments DOE requests comment and data as to
losses and maximum no-load losses for suggest that there are also general whether 5,000 kVA represents the upper
end of what is considered distribution
40 See NRCAN dry-type transformer energy 41 Official Journal of the European Union,
efficiency regulations at www.nrcan.gc.ca/energy- Commission Regulation (EU) No. 548/2014, May 21, 42 See Federal Pacific comment on Docket No.
efficiency/energy-efficiency-regulations/guide- 2014, Available online at: https://eur-lex.europa.eu/ EERE–2006–STD–0099–0105. Available at

canadas-energy-efficiency-regulations/dry-type- legal-content/EN/TXT/?uri=uriserv%3AOJ.L_ www.regulations.gov/comment/EERE-2006-STD-
transformers/6875. .2014.152.01.0001.01.ENG. 0099-0105.
transformers or if another value should based on lowest first cost and would higher or lower standard. (42 U.S.C.
be used. rely on similar grades of electrical steel 6316(a); 42 U.S.C. 6295(q)(1)) In
DOE has also estimated potential as the distribution transformers that are determining whether a performance-
energy savings associated with currently in-scope units but would not related feature justifies a different
expanding coverage of distribution currently be meeting any efficiency standard for a group of products, DOE
transformers between 2,500 and 5,000 standard. must consider such factors as the utility
kVA within scope. DOE relied on public DOE requests comment and data as to to the consumer of the feature and other
comments and confidential data sources the number of shipments of three-phase, factors DOE deems appropriate. Id. Any
to estimate shipments between 2,500 liquid-immersed, distribution rule prescribing such a standard must
kVA and 5,000 kVA. Further, DOE has transformers greater than 2,500 kVA that include an explanation of the basis on
scaled its engineering analysis to would meet the in-scope voltage which such higher or lower level was
encompass these larger units. Although limitations and the distribution of established. (42 U.S.C. 6316(a); 42
the number of units shipped is efficiencies of those units. U.S.C. 6295(q)(2))
estimated to represent a fraction of a DOE requests comment and data as to Eleven equipment classes are
percentage of total covered shipments, the number of shipments of three-phase, established under the existing standards
DOE has designed these scaled models dry-type, distribution transformers for distribution transformers, one of
as new representative units on account greater than 2,500 kVA that would meet which (mining transformers 43) is not
of starting from an unregulated baseline, the in-scope voltage limitations and the subject to energy conservation
as compared to the rest of the market, distribution of efficiencies of those standards. 10 CFR 431.196. The
for which the baseline transformer units. remaining ten equipment classes are
complies with existing energy delineated according to the following
conservation standards. For liquid- 2. Equipment Classes characteristics: (1) Type of transformer
immersed distribution transformers, DOE must specify a different standard insulation: Liquid-immersed or dry-
representative unit 17 corresponds to a level for a type or class of product that type, (2) Number of phases: single or
three-phase 3,750 kVA unit. For has the same function or intended use, three, (3) Voltage class: low or medium
medium-voltage dry-type distribution if DOE determines that products within (for dry-type only), and (4) Basic
transformers, representative units 18 such group: (A) consume a different impulse insulation level (BIL) (for
and 19 correspond to a three-phase kind of energy from that consumed by MVDT only).
3,750 kVA unit with a BIL of 46–95 kV other covered products within such type Table II.1 presents the eleven
and greater than 96 kV, respectively. (or class); or (B) have a capacity or other equipment classes that exist in the
DOE has estimated the distribution performance-related feature which other current energy conservation standards
transformer efficiency by assuming products within such type (or class) do and provides the kVA range associated
these out-of-scope units are purchased not have and such feature justifies a with each.
TABLE IV.1—CURRENT EQUIPMENT CLASSES FOR DISTRIBUTION TRANSFORMERS

EC * # Insulation Voltage Phase BIL rating kVA range
EC1 ............... Liquid-Immersed .......... Medium ........................ Single ........................... ...................................... 10–833 kVA
EC2 ............... Liquid-Immersed .......... Medium ........................ Three ........................... ...................................... 15–2500 kVA
EC3 ............... Dry-Type ...................... Low .............................. Single ........................... ...................................... 15–333 kVA
EC4 ............... Dry-Type ...................... Low .............................. Three ........................... ...................................... 15–1000 kVA
EC5 ............... Dry-Type ...................... Medium ........................ Single ........................... 20–45 kV BIL ............... 15–833 kVA
EC6 ............... Dry-Type ...................... Medium ........................ Three ........................... 20–45 kV BIL ............... 15–2500 kVA
EC7 ............... Dry-Type ...................... Medium ........................ Single ........................... 46–95 kV BIL ............... 15–833 kVA
EC8 ............... Dry-Type ...................... Medium ........................ Three ........................... 46–95 kV BIL ............... 15–2500 kVA
EC9 ............... Dry-Type ...................... Medium ........................ Single ........................... ≥96 kV BIL ................... 75–833 kVA
EC10 ............. Dry-Type ...................... Medium ........................ Three ........................... ≥96 kV BIL ................... 225–2500 kVA
EC11 ............. Mining Transformers

* EC = Equipment Class.
In the August 2021 Preliminary DOE currently does not divide pole- ferroresonace.44 (August 2021
Analysis TSD, DOE requested comment and pad-mounted distribution Preliminary Analysis TSD at p. 2–19)
on a variety of other potential transformers into separate equipment Eaton commented that ferroresonance
equipment setting factors. (August 2021 classes. In the August 2021 Preliminary is rare and only occurs in pad mounted
Preliminary Analysis TSD at p. 2–16– Analysis TSD, DOE requested comment transformers. (Eaton, No. 55 at pp. 9–10)
22) These comments are discussed in and data to characterize the effect of Eaton added that ferroresonance is more
detail below. mounting configuration on distribution likely to occur in low no-load loss cores,
transformer efficiency, weight, volume, and commented that these effects can be
a. Pole- and Pad-Mounted Transformers mitigated with certain core designs that
and likelihood of introducing
are slightly less efficient. (Eaton, No. 55

43 A mining distribution transformer is a medium- drilling, or tunneling underground or above ground, capacitive and inductive elements which can lead
voltage dry-type distribution transformer that is and that has a nameplate which identifies the to damaging high voltages in distribution
built only for installation in an underground mine transformer as being for this use only. 10 CFR transformers. Pad-mounted distribution
or surface mine, inside equipment for use in an 431.192. transformers that are delta-connected are
underground mine or surface mine, on-board 44 Ferroresonance refers to the nonlinear particularly susceptible to ferroresonance effects.
equipment for use in an underground mine or
surface mine, or for equipment used for digging, resonance resulting from the interaction of system
at pp. 9–10) Eaton added that it has DOE requested comment on some of the efficient units, they are generally
produced thousands of low-loss 5-leg options a customer is likely to explore installation costs (i.e., expanding the
distribution transformers and is before incurring the cost of vault size of the vault in which the
unaware of a single occurrence of expansion, such as using a lower-loss distribution transformer is installed).
ferroresonace. (Eaton, No. 55 at pp. 9– core steel, copper windings, or a less- Installation costs are addressed in the
10) flammable insulating fluid. (August LCC and PBP analyses, as well as in
DOE did not receive any data 2021 Preliminary Analysis TSD at p. 2– consumer subgroup-specific analyses.
suggesting that pole- and pad-mounted 20) These analyses account for the cost of
distribution transformers warrant NEMA commented that when trying difficult (i.e., unusually costly)
separate equipment classes. As such, to fit into a given space, copper installations, including those subgroups
DOE has not proposed to amend the windings may allow for a 20 percent of the population that may be
current equipment class structure for size reduction relative to aluminum and differentially impacted by DOE’s
pole- and pad-mounted distribution higher-grade core steels can help, but it consideration of amended energy
transformers. Further, DOE includes is still sometimes very difficult to conservation standards (see section
both pole- and pad-mounted reduce footprint while meeting IV.I.2 of this document).
representative units in its engineering standards. (NEMA, No. 50 at p. 6) Carte Review of comments and the
analysis. requested an exclusion for retro fit equipment market indicates that certain
designs. (Carte, No. 54 at p. 2) vault-based distribution transformers
b. Submersible Transformers
Carte commented that most network also are designed to operate in
Certain distribution transformers are transformers are lightly loaded but submersible applications. Because many
installed underground and, accordingly, redundancy is quite important and as vaults are subterranean, distribution
may endure partial or total immersion such many customers require high transformers installed in such locations
in water. This scenario commonly arises overload capabilities. (Carte, No. 54 at p. often require ability to operate while
for distribution transformers installed in 1) Carte added that in certain submerged. Installation below grade
chambers called ‘‘vaults’’, which are applications, with limited space, there makes more likely that distribution
commonly made of concrete. Access is is reduced cooling which forces transformers may operate while
typically, but not always, through an manufacturers to lower load loss at the submerged in water and with other run-
opening in the top (‘‘ceiling’’) face of the expense of core loss to maintain reliable off debris. Distribution transformers for
vault, through which the distribution installation in such environments are
operation. (Carte, No. 54 at pp. 1–2) EEI
transformer can be lowered for designed to withstand harsh conditions,
recommended DOE include a separate
installation or replacement. including corrosion.
‘‘Submersible’’, ‘‘network’’ and product class for vault transformers.
(EEI, No. 56 at p. 3) The subterranean installation of
‘‘vault-based’’ are three attributes that submersible distribution transformers
As discussed, EPCA requires that a
often all apply to a particular means that there is less circulation of
distribution transformer unit, but which rule prescribing an energy conservation
standard for a type of covered ambient air for shedding heat. Operation
carry distinct meanings. Informally, while submerged in water and in
‘‘submersible’’ refers to ability to equipment specify a level of energy use
or efficiency higher or lower than that contact with run-off debris, further
operate while submerged, ‘‘network’’ impacts the ability of a distribution
refers to ability to operate as part of a which applies (or would apply) to any
group of covered equipment that has the transformer to transfer heat to the
network of interconnected secondary environment and limits the alternative
windings as most typically occurs in same function or intended use, if the
approaches in the external environment
urban environments, and ‘‘vault-based’’ Secretary determines that covered
that can be used to increase cooling.
refers to siting within a vault, which equipment within such group:
With respect to heat transfer, the
may be but is not necessarily below (A) Consume a different kind of
industry standards governing
grade. A given distribution transformer, energy from that consumed by other
submersible distribution transformers,
for example, may be installed within an covered products within such type (or
i.e., IEEE C57.12.23–2018 and
above-grade vault but not rated as class); or C57.12.24–2016, specify that
submersible. Similarly, a particular (B) Have a capacity or other
submersible distribution transformers,
network distribution transformer may performance-related feature that other amongst other requirements, have their
happen to be installed within a vault, products within such type (or class) do capacity rated for a maximum
but able to operate as well outside of a not have and such feature justifies a temperature rise of 55°C but have their
vault. higher or lower standard from that insulation be rated for 65°C. IEEE
In the April 2013 Standards Final which applies (or will apply) to other C57.12.80–2010 defines submersible
Rule, DOE included additional costs for products within such type (or class). distribution transformer as ‘‘a
vault replacements in the LCC analysis (42 U.S.C. 6313(a); 42 U.S.C. 6295(q)(1)) transformer so constructed as to be
but noted there was no technical barrier In making a determination of whether successfully operable when submerged
that prevents network, vault-based and a performance-related feature justifies in water under predetermined
submersible distribution transformers the establishment of a higher or lower conditions of pressure and time.’’
from achieving the same efficiency standard, the Secretary must consider Distribution transformer temperature
levels as other liquid-immersed such factors as the utility to the rise tends to be governed by load losses.
distribution transformers. 78 FR 23336, consumer of such a feature, and such Often, design options that reduce load
23356–23357. In the August 2021 other factors as the Secretary deems losses, increase no-load losses. While
Preliminary Analysis TSD, DOE appropriate. Id. no-load losses make up a relatively
preliminarily stated that it would take a As noted, DOE previously determined small portion of losses at full load, no-
similar approach in applying the costs there was no technical barrier to vault load losses contribute approximately
of vault enlargement as a function of distribution transformers achieving equally to load losses at 50 percent PUL,
increased distribution transformer similar efficiency standards as other at which manufacturers must certify
volume for RU4 and RU5. (August 2021 similar distribution transformers. To the efficiency. The potentially reduced heat
Preliminary Analysis TSD at p. 2–89) extent significant costs arise for more- transfer of the subterranean
environment, combined with the no-load losses. DOE has modeled the transformers that allow them to operate
possibility of operating while derating of these distribution while submerged in water, as well as
submerged, limits customers from transformers and the associated costs data on the impact to efficiency
meeting the temperature rise limitations associated with these submersible resulting from such characteristics.
through any choice other than reducing distribution transformers, as described DOE requests comment and data as to
load losses. Therefore, the design in section IV.C.1 of this document. the impact that submersible
choices needed to meet a lower In proposing separate equipment characteristics have on distribution
temperature rise, may tend to lead classes, DOE relies on physical features transformer efficiency.
manufacturers to increase no-load losses to distinguish one product class from
another. While the IEEE definition of c. Multi-Voltage-Capable Distribution
and may make it more difficult to meet
‘‘submersible transformer’’ described Transformers
a given efficiency standard at 50 percent
PUL. how a submersible distribution DOE’s test procedure section 5.0 of
DOE recognizes that distribution transformer should perform, it does not appendix A requires determining the
transformers other than those designed include specific physical features that efficiency of multi-voltage-capable
for submersible operation may be would allow DOE to identify distribution transformers in the
derated (rated for a lower temperature submersible transformers from other configuration in which the highest
rise) for other reasons, such as general purpose distribution losses occur. In the August 2021
installation in ambient temperatures transformers. In reviewing industry Preliminary Analysis TSD, DOE
over 40°C, greater harmonic currents, or standards, DOE notes that submersible acknowledged that certain multi-voltage
installation at altitudes above 1000 distribution transformers are rated for a distribution transformers, particularly
meters. However, the ability to improve temperature rise of 55°C, have non-integer ratio 45 distribution
the efficiency of such distribution insulation rated for 65°C, have sealed- transformers could have a harder time
transformers is not similarly limited as tank construction, and have the tank, meeting an amended efficiency standard
submersible distribution transformers cover, and all external appurtenances be as it results in an unused portion of a
because other options exist for made of corrosion-resistant material. winding when testing in the highest
distribution transformers above grade Consistent with industry practice, DOE losses configuration and therefore
that would not be feasible in submerged is proposing to define submersible reduces the measured efficiency.
environments, namely the ability to distribution transformer as ‘‘a liquid- (August 2021 Preliminary Analysis TSD
increase heat transfer, often with some immersed distribution transformer so at p. 2–21) DOE requested comment on
additional cost, as opposed to only constructed as to be successfully the difference in losses associated with
options that increase a distribution operable when submerged in water multi-voltage distribution transformers.
transformer’s no-load losses. For including the following features: (1) is (August 2021 Preliminary Analysis TSD
example, distribution transformers rated for a temperature rise of 55°C; (2) at p. 2–21)
installed above grade may be able to has insulation rated for a temperature Schneider commented that the higher
have more air circulation through rise of 65°C; (3) has sealed-tank nominal voltage tends to be more
radiators, improving the efficiency of construction; and (4) has the tank, efficient, but the degree of increased
radiators to shed heat, or adding cover, and all external appurtenances losses depends on the kVA and
external forced air cooling on a made of corrosion-resistant material.’’ difference between nominal voltages.
distribution transformer radiator, DOE notes that IEEE C57.12.80–2010 (Schneider, No. 49 at p. 9) Schneider
whereas such a measure would not be defines several other types of commented that the challenge for DOE
able to function as intended in a distribution transformers that would is ensuring manufacturers are testing in
submerged environment. potentially also meet the proposed worst case conditions and
Based on the foregoing discussion, definition of ‘‘submersible distribution recommended DOE require
DOE has tentatively determined that transformer.’’ IEEE C57.12.80–2010 manufacturers to identify these
distribution transformers designed to defines ‘‘vault-type transformer’’ as ‘‘a transformers and/or requiring on the
operate while submerged and in contact transformer that is so constructed as to distribution transformer nameplate.
with run-off debris have a performance- be suitable for occasional submerged (Schneider, No. 49 at pp. 10–12)
related feature which other types of operation in water under specified Schneider recommended DOE audit
distribution transformers do not have. conditions of time and external these multi-voltage designs to ensure
While at max-tech efficiency levels both pressure.’’ Similarly, IEEE C57.12.80– they are testing under proper
no-load and load losses are so low that 2010 defines ‘‘network transformer’’ as conditions. (Schneider No. 49 at pp. 12–
distribution transformers generally do ‘‘a transformer designed for use in a 13) Schneider expanded that these
not meet their rated temperature rise, at vault to feed a variable capacity system products should not have a separate
intermediate efficiency levels, trading of interconnected secondaries,’’ and equipment class but should be audited
load losses for no-load losses allows states that ‘‘a network transformer may by DOE. (Schneider, No. 49 at p. 13)
distribution transformers to be rated for be of the submersible or of the vault Schneider’s data indicates that the
a lower temperature rise, however, it type.’’ To the extent network and vault- degree of coil loss increase associated
also may make it more difficult to meet type distribution transformers were to with multi-voltage secondary
any amended efficiency standard as no- meet the proposed definition of distribution transformers ranges from
load losses contribute proportionally submersible distribution transformer, 3.7 percent to 10.8 percent of full-load
more to efficiency at the test procedure they would be included in the coil losses. (Schneider No. 49 at p. 10)
PUL as compared to rated temperature submersible distribution transformer

rise. Therefore, DOE is proposing that equipment class. 45 For example, a primary winding low voltage
providing for operation in installation DOE requests comment on its configuration of 7200 V and a primary winding high
locations at which the units are partially understanding and proposed definition voltage configuration of 14400 V represents a 2
or wholly submerged in water justifies of ‘‘submersible’’ distribution times increase in voltage. Whereas a primary
winding low voltage configuration of 7200 V and
a different standard on account of the transformer. Specifically, DOE requests a primary winding high voltage configuration of
additional constraint which forces information on specific design 13200 V represents a non-integer increase in voltage
manufacturers to trade load losses for characteristics of distribution leaving some portion of the coil unused.
DOE notes that each efficiency level transformer. These transformers are ratings and a voltage ratio other than
considered offers a range of no-load and often used in upgrading distribution 2:1.
load loss combinations for meeting line voltages and as such when the DOE request data on the number of
efficiency levels. While a multi-voltage distribution line voltage is upgraded, shipments for each equipment class of
transformer may require manufacturers these distribution transformers would distribution transformers with multi-
to invest more in reducing no-load loss have greater efficiency than their voltage ratios other than 2:1.
relative to a similar single voltage certified efficiency. These distribution d. High-Current Distribution
transformer, it would generally still be transformers have additional, unused Transformers
able to serve those customers’ needs that winding turns when operated at their
request a multi-voltage distribution lower voltage which increase losses. Carte commented that low secondary
transformer. However, once the distribution grid has voltages with high currents can increase
ERMCO and NEMA acknowledged been increased to the higher voltage, the the cost and weight of a distribution
that some multi-voltage units may have entire winding will be used, increasing transformer and may require switching
a harder time achieving efficiency the efficiency of the product. However, to copper. (Carte, No. 54 at p. 1) NEMA
standards but did not provide a DOE lacks data as to the degree of no- commented that new production
recommendation as to how to treat load loss and load loss increase machines may be needed for certain
them. (ERMCO, No. 45 at p. 1; NEMA, associated with transitioning from a winding configurations near technical
No. 50 at p. 6) Eaton commented that single primary and secondary voltage limits, such as large kVA distribution
transformers with multiple voltage distribution transformer to a multi- transformers with 208 voltage
rating and non-whole integer ratings voltage distribution transformer. secondaries. (NEMA, No. 50 at p. 10)
have unused turns and require DOE notes that the NRCAN Eaton commented that lower voltage
additional space in the core window regulations specify that ‘‘For a three- windings have higher currents which
leading to higher losses. (Eaton, No. 55 phase transformer having multiple high- may require rectangular conductors and
at p. 12) Carte identified emergency use voltage windings and a voltage ratio can make winding more complicated.
other than 2:1, the minimum energy (Eaton, No. 55 at p. 12) Eaton added that
distribution transformers which have
efficiency standard from the table or at some sizes, the conductor becomes
multiple high voltages and low voltages
interpolated is reduced by 0.11.’’ too thick to be used in a transformer.
and can be used anywhere in a system
Similarly, EU regulations permit (Eaton, No. 55 at p. 12) NEMA
until a proper replacement is added,
between a 10 to 20 percent increase in commented that these designs are on the
and asked how standards apply to them.
load losses for dual voltage transformers cusp of max-tech today. (NEMA, No. 50
(Carte, No. 54 at p. 2)
and between 15 and 20 percent increase at p. 10)
As discussed, EPCA requires that a Distribution transformers with high
rule prescribing an energy conservation in no-load losses, depending on the type
of dual voltage. currents tend to have increased stray
standard for a type of covered losses which can impact the efficiency
equipment specify a level of energy use Schneider commented that multi-
voltage transformers do not need a of distribution transformers. NEMA
or efficiency higher or lower than that cited a 2,000 kVA design with a 208V
which applies (or would apply) to any lesser standard as it is a manufacturers
choice to produce them. (Schneider, No. secondary where buss losses contribute
group of covered equipment that has the approximately 12 percent to the full
49 at p. 10) Schneider added that they
same function or intended use, if the load losses of the transformer. (NEMA,
have many non-integer multi-voltage
Secretary determines that covered No. 50 at p. 5) DOE notes that NRCAN
ratios offered and do not believe it is
equipment within such group: regulations exclude transformers with a
necessary to create a new class for these
(A) Consume a different kind of nominal low-voltage line current of
products. (Schneider, No. 49 at p. 10)
energy from that consumed by other 4000 A or more. In general, this
Stakeholder comments suggest that
covered products within such type (or the difference in voltages associated amperage limitation would impact large
class); or with multi-voltage distribution distribution transformers with low-
(B) Have a capacity or other
transformers is relatively small. Further, voltage secondary windings.
performance-related feature that other DOE notes that in high-current
technologies that increase the efficiency
products within such type (or class) do applications, while stray losses may be
of single-voltage distribution
not have and such feature justifies a slightly higher, manufacturers have the
transformers also increase the efficiency
higher or lower standard from that option to use copper secondaries to
of multi-voltage distribution
which applies (or will apply) to other decrease load losses or a copper buss
transformers. For these reasons, DOE
products within such type (or class). bar. Technologies that increase the
has not proposed a separate equipment
(42 U.S.C. 6313(a); 42 U.S.C. 6295(q)(1)) class for multi-voltage-capable efficiency of lower-current distribution
In making a determination of whether distribution transformers with a voltage transformers also increase the efficiency
a performance-related feature justifies ratio other than 2:1. of high-current distribution
the establishment of a higher or lower However, DOE may consider a transformers. To the extent new
standard, the Secretary must consider separate product class if sufficient data production machines would be needed
such factors as the utility to the is provided to demonstrate that these to accommodate the increased strip
consumer of such a feature, and such distribution transformers justify a widths associated with high-current
other factors as the Secretary deems different energy conservation standard. distribution transformers, those would
appropriate. Id. DOE notes that these distribution be accounted for in the manufacturer
DOE acknowledges that multi-voltage
transformers would not be permitted to impact analysis. For these reasons, DOE
distribution transformers, specifically have a lesser standard than currently has not proposed a separate equipment
those with non-integer ratios, offer the applicable to them on account of class for high-current distribution
performance feature of being able to be EPCA’s anti-backsliding provisions at 42 transformers.
installed in multiple locations within U.S.C. 6295(o). However, DOE may consider a
the grid (such as in emergency DOE requests data on the difference in separate product class if sufficient data
applications) and easily upgrade grid load loss by kVA for distribution is provided to demonstrate that high-
voltages without replacing a distribution transformers with multiple-voltage current distribution transformers justify
a different energy conservation 2. Temperature rise less than 130 °C Eaton commented that liquid-
standard. DOE notes that these with class 220 (25) insulation or immersed distribution transformers are
distribution transformers would not be temperature rise less than 110 °C with increasingly being used in data center
permitted to have a lesser standard than class 200 (26) insulation; applications. (Eaton, No. 55 at p. 10)
currently applicable to them on account 3. A secondary winding arrangement Eaton added that the quantity and
of EPCA’s anti-backsliding provisions at that is not delta or wye (star); overall energy consumed in data center
42 U.S.C. 6295(o). 4. Copper primary and secondary applications has increased significantly.
DOE requests data on the difference in windings; (Eaton, No. 55 at p. 10) Eaton
load loss by kVA for distribution 5. An electrostatic shield; or commented that the lifespan of a data
transformers with higher currents and at 6. Multiple outputs at the same center transformer would vary
what current it becomes more difficult voltage a minimum of 15° apart, which depending on loading. (Eaton, No. 55 at
to meet energy conservation standards. when summed together equal the p. 11)
DOE requests data as to the number of transformer’s input kVA capacity.’’ 46 Eaton commented that liquid-
shipments of distribution transformers DOE did not adopt this definition of immersed data center transformers are
with the higher currents that would ‘‘data center distribution transformers’’ designed to operate between 50–75
have a more difficult time meeting or establish a separate class for such percent PUL and are typically specified
energy conservation standards. equipment for the following reasons: (1) to meet DOE efficiency standards.
the considered definition listed several (Eaton, No. 55 at pp. 10–11)
e. Data Center Distribution Transformer DOE did not receive any comments
factors unrelated to efficiency; (2) the
In the April 2013 Standard Final Rule, potential risk of circumvention of suggesting that data center distribution
DOE considered a separate equipment standards and that a transformer may be transformers warrant a separate product
class for data center distribution built to satisfy the data center definition class. As such, DOE has not proposed a
transformers, defined as the following: without significant added expense; (3) definition for data center distribution
‘‘i. Data center transformer means a operators of data centers are generally transformers and has not evaluated
three-phase low-voltage dry-type interested in equipment with high them as a separate product class.
distribution transformer that— However, DOE may consider a separate
efficiencies because they often face large
(i) Is designed for use in a data center product class if sufficient data is
electricity costs, and therefore may be
distribution system and has a nameplate provided to demonstrate that data center
purchasing at or above the standard
identifying the transformer as being for transformers warrant a different
established and unaffected by the rule;
this use only; efficiency level and can appropriately
and (4) data center operator can take
(ii) Has a maximum peak energizing be defined. Distribution transformers
steps to limit in-rush current external to
current (or in-rush current) less than or used in data centers may sometimes, but
the data center transformer. 78 FR
equal to four times its rated full load not necessarily, be subject to different
23336, 23358.
current multiplied by the square root of operating conditions and requirements
In the August 2021 Preliminary which carry greater concern
2, as measured under the following
Analysis TSD, DOE stated that data surrounding inrush current.
conditions—
1. During energizing of the center distribution transformers could DOE requests comment regarding its
transformer without external devices represent a potential equipment class proposal not to establish a separate
attached to the transformer that can setting factor and requested additional equipment class for data center
reduce inrush current; data about the data center distribution distribution transformers. In particular,
2. The transformer shall be energized transformer market, performance DOE seeks comment regarding whether
at zero +/¥3 degrees voltage crossing of characteristics, and any physical data center distribution transformers are
a phase. Five consecutive energizing features that could distinguish data able to reach the same efficiency levels
tests shall be performed with peak center distribution transformers from as distribution transformers generally
inrush current magnitudes of all phases general purpose distribution and the specific reasons why that may
recorded in every test. The maximum transformers. (August 2021 Preliminary be the case.
peak inrush current recorded in any test Analysis TSD at p. 2–22) DOE requests comment regarding any
shall be used; DOE did not receive any comments as challenges that would exist if designing
3. The previously energized and then to physical features that could a distribution transformer which uses
de-energized transformer shall be distinguish a data center distribution amorphous electrical steel in its core for
energized from a source having transformer from a general-purpose data center applications and whether
available short circuit current not less distribution transformer. data center transformers have been built
than 20 times the rated full load current DOE requests comment as to what which use amorphous electrical steel in
of the winding connected to the source; modifications could be made to the their cores.
and April 2013 Standard Final Rule data DOE requests comment on the
4. The source voltage shall not be less center definition such that the interaction of inrush current and data
than 5 percent of the rated voltage of the identifying features are related to center distribution transformer design.
winding energized; and efficiency and would prevent a data Specifically, DOE seeks information
(vii) Is manufactured with at least two center transformer from being used in a regarding: (1) the range of inrush current
of the following other attributes: general purpose application. limit values in use in data center
1. Listed as a Nationally Recognized NEMA commented that most data distribution transformers; (2) any
Testing Laboratory (NRTL), under the center transformers are outside the challenges in meeting such inrush
Occupational Safety and Health scope due to kVA range, but those still current limit values when using
Administration, U.S. Department of within scope would likely have high amorphous electrical steel in the core;
Labor, for a K-factor rating greater than loading and would not be favored for (3) whether using amorphous electrical
K–4, as defined in Underwriters amorphous transformers. (NEMA, No. steel inherently increases inrush
Laboratories (UL) Standard 1561: 2011 50 at p. 6) current, and why; (4) how the
Fourth Edition, Dry-Type General (magnetic) remanence of grain-oriented
Purpose and Power Transformers; 46 78 FR 23336, 23358. electrical steel compares to that of
amorphous steel; and (5) other strategies ratings for distribution transformers and 3. Test Procedure
or technologies than distribution the volume of dry-type distribution The current test procedure for
transformer design which could be used transformers sold with BIL ratings above measuring the energy consumption of
to limit inrush current and the 199 kV. DOE did not receive any data distribution transformers is established
respective costs of those measures. and therefore has maintained its current at appendix A to subpart K of 10 CFR
f. BIL Rating equipment class separation of MVDTs. part 431. In a September 2021 TP Final
Distribution transformers are built to g. Other Types of Equipment Rule, DOE maintained that energy
carry different basic impulse level efficiency be evaluated at 50 percent
Stakeholders identified several other PUL for liquid-immersed distribution
(‘‘BIL’’) ratings. BIL ratings offer distribution transformer types that they
increased resistance to large voltage transformers and medium-voltage dry-
noted may have a harder time meeting type distribution transformers and 35
transients, for example, from lightning efficiency standards. NEMA commented
strikes. Due to the additional winding percent PUL for low-voltage dry-type
that MVDTs at high altitude may require distribution transformers. 86 FR 51230.
clearances required to achieve a higher more air clearance and therefore must
BIL rating, high BIL distribution In the August 2021 Preliminary
accommodate higher core loss, and as Analysis TSD, DOE acknowledged that
transformers tend to be less efficient, such, may warrant a separate equipment
leading to higher costs and be less able its estimates for current root-mean-
class. (NEMA, No. 50 at p. 5) Carte square (‘‘RMS’’) in-service loading is
to achieve higher efficiencies. DOE asked DOE to analyze main and teaser
separates medium-voltage dry-type less than the test procedure PUL but
and Scott connected transformers which noted there was uncertainty which
distribution transformers into it stated are unique to certain industrial
equipment classes based on BIL ratings. makes it preferential to overestimate
grids and can be very difficult or PUL rather than underestimate PUL.
10 CFR 431.196(c). impossible to replace.47 (Carte, No. 54 at
In the August 2021 Preliminary DOE noted that any potential energy
p. 2) savings that could be achieved by
Analysis TSD, DOE noted stakeholder Carte asked how efficiency standards
comments that evaluating additional changing the standard PUL could also
apply to duplex transformers which be achieved by increasing the stringency
liquid-immersed distribution have two kVA ratings on one
transformers based on BIL rating would of the energy conservation standards. As
transformer.48 (Carte, No. 54 at p. 2) such, DOE only considered distribution
add additional complications for minor Carte asked if three winding
differences in losses. As such, DOE did transformers that would meet energy
simultaneous loading transformers used conservation standards at DOE’s test
not consider BIL in its evaluation of in solar applications to isolate the low-
liquid-immersed distribution procedure loading, but evaluated energy
voltage qualify for an exemption. (Carte, saving potential using in-service data
transformers. No. 54 at p. 2)
In response, Howard commented that and load growth estimates.
DOE did not receive any data as to the In response, CDA agreed with the test
150 kV and 200 kV BIL units should not
degree of difference in efficiency procedure loading and stated that they
have their efficiency standards
associated with these distribution believe the loading will match future
increased as these units are already too
transformers. DOE has not considered forecasts. (CDA, No. 47 at p. 2)
large. (Howard, No. 59 at pp. 1–2) Carte
any of the noted products as separate NEEA and the Efficiency Advocates
commented that 200 kV BIL
equipment classes in this NOPR commented that the test procedure PUL
transformers have more insulation that
analysis due to lack of data as to the is too high and leads to designs that
increases the size of the transformer and
shipments and reduction in efficiency over-invest in load losses, and as such,
therefore the losses of the transformer.
associated with certain designs. DOE should reduce the test procedure
(Carte, No. 54 at p. 1) Eaton commented
Regarding how standards are applied to PUL. (Efficiency Advocates, No. 52 at
that high BIL transformers can have a
certain equipment, DOE notes that pp. 1–2; NEEA, No. 51 at pp. 7–8) The
harder time meeting efficiency
equipment that meets the definition of Efficiency Advocates commented that
standards. (Eaton, No. 55 at p. 12)
distribution transformer is subject to DOE’s preliminary analysis shows that
Neither Eaton, Howard nor Carte
energy conservation standards at 10 CFR intermediate energy savings can be
provided any data suggesting the degree
431.196. achieved with small price increases if
of efficiency difference as BIL is
DOE requests comments and data on transformer designs are optimized for
increased. Based on the discussion in
any other types of equipment that may more realistic PULs and urged DOE to
the preceding paragraphs, DOE is not
have a harder time meeting energy consider revising its test procedure PUL,
proposing a separate equipment class
conservation standards. Specifically, given the preliminary analysis load
based on BIL rating for liquid-immersed
DOE requests comments as to how these growth estimates. (Efficiency Advocates,
units but may consider it if sufficient
other equipment are identified based on No. 52 at p. 2) The Efficiency Advocates
data is provided.
physical features from general purpose commented that the negative savings at
DOE requests data as to how a liquid-
distribution transformers, the number of certain ELs reflect the fact that certain
immersed distribution transformer
shipments of each unit, and the ELs would be met by decreasing load
losses vary with BIL across the range of
possibility of these equipment being losses rather than no-load losses.
kVA values within scope.
Regarding MVDTs, NEMA used in place of generally purpose (Efficiency Advocates, No. 52 at pp. 2–
commented that MVDT with BIL levels distribution transformers. 3) The Efficiency Advocates further
above 150 kV are essentially non- referenced DOE’s hourly load model
47 Main and Teaser and Scott connected
which they claim demonstrated a small
existent and would not represent a transformers are a special type of transformer which
significant amount of energy savings if converts from three-phase energy to two phase percentage of hours above 50 percent
regulated. (NEMA, No. 50 at p. 7) energy or vice versa using two electrically- PUL and indicates savings available at
DOE notes that MVDTs above 150 kV connected single-phase transformers lower PULs. (Efficiency Advocates, No.
48 Duplex transformers consist of two single-
BIL are currently regulated. In the 52 at p. 4) The Efficiency Advocates
phase transformers assembled in a single enclosure.
August 2021 Preliminary Analysis TSD, They are generally used to provide a large single-
commented that a lower PUL permits
DOE requested data on the change in phase output in tandem with a smaller three-phase greater savings for less costs, claiming
efficiency associated with higher BIL output that DOE’s data shows better optimizing
a transformer could yield 23 percent counterproductive. (Powersmiths, No. recommended DOE should require third
energy savings for only a 4 percent 46 at p. 2) Powersmiths recommended party testing of distribution
increase in costs. (Efficiency Advocates, DOE work with organizations to reduce transformers. (Powersmiths, No. 46 at
No. 52 at pp. 4–5) oversizing of distribution transformers. pp. 6–7) DOE notes that it has no data
DOE notes that the potential energy (Powersmiths, No. 46 at p. 2) suggesting manufacturers are shipping
savings cited by the Efficiency DOE agrees with stakeholders that non-compliant distribution
Advocates are based on a distribution current loading is lesser than the test transformers. DOE notes that in the case
transformer that is optimized at 35 procedure PUL. As such, DOE relies on of sub-standard steel batches, its
percent PUL and is meeting current the most accurate in-service PUL and certification requirements permit some
efficiency standards at 50 percent PUL. load growth estimates to calculate degree of variability in equipment
In the scenario where an alternative test energy savings potential. However, DOE performance, as described at 10 CFR
procedure PUL is used, distribution evaluates the efficiency of distribution 429.47.
transformers would not have to meet the transformers and only includes Powersmiths commented that high
current standard at 50 percent PUL, they distribution transformer models that volume manufacturers optimize costs by
would only have to meet a new standard would meet amended energy using higher loss core steel and lower
at 35 percent PUL. DOE’s analysis of conservation standards at the test loss conductor material to meet the 35
energy conservation standards assumes procedure PUL. The efficiency of percent legal limit. (Powersmiths, No.
consumers select a range of distribution distribution transformers over the 46 at p. 2) Powersmiths recommended
transformers and applies a range of duration of its lifetime and across all lowering the LVDT test procedure PUL
unique customer loading profiles to installations cannot be fully represented or adding a core loss limit to secure real
evaluate the impacts of amended energy by a single PUL. A given transformer world energy savings. (Powersmiths,
conservation standards. In a theoretical may be highly loaded or lightly loaded No. 46 at p. 2)
evaluation of energy conservation depending on its application or In the September 2021 TP Final Rule,
standards at 35 percent PUL, the whole variation in electrical demand DOE noted that on account of
analysis would change as new throughout the day. In the September uncertainty associated with future
distribution transformers would be able 2021 TP Final Rule, DOE was unable to distribution transformer loading, DOE is
to be purchased by consumers that do conclude that any singular PUL would unable to conclude that any alternative
not meet current standards at 50 percent be more representative than the current single-PUL efficiency metric is more
PUL but may meet a standard at 35 test procedure PUL because of (1) representative than the current standard
percent PUL. Without doing a much significant long-term uncertainty PUL. 86 FR 51230, 51240. Therefore,
more detailed analysis, it is a vast regarding what standard PUL would DOE only evaluated distribution
oversimplification to cite energy savings correspond to a representative average transformers that would meet amended
from a single distribution transformer. use cycle for a distribution transformer efficiency standards at the current test
Further, DOE notes that many of the given their long lifetimes; and (2) given procedure PUL. In its evaluation of
distribution transformers optimized for the uncertainty of future loading, there energy savings, DOE used data
low PULs use amorphous cores and may be greater risk associated with representative of current in-service
represent the design options with the selecting a test procedure PUL that is loading, as described in section IV.E.
highest efficiency at 50 percent PUL. too low than a test procedure PUL that DOE does not make assumptions as to
Powersmiths commented that is too high. 86 FR 51230, 51240. the maximum no-load or load losses of
measuring LVDT efficiency at a single Therefore, for purposes of evaluating the a transformer and instead relies on the
load point is insufficient since the proposed standards in this document, consumer choice model, described in
efficiency varies dramatically over the DOE used the test procedure PUL. More section IV.F.3 of this document, to
loading. (Powersmiths, No. 46 at p. 1) discussion of the test procedure PUL evaluate the distribution transformers
Powersmiths added that 35 percent PUL may be found in the September 2021 TP that consumers are likely to purchase.
is not representative for LVDTs. Final Rule.
(Powersmiths, No. 46 at p. 1) DOE disagrees with commenters’ 4. Technology Options
Powersmiths added that evaluating at 35 assertion that there is an inherent In the preliminary market analysis
percent PUL enables manufacturers to benefit associated with distribution and technology assessment, DOE
publish peak efficiency rather than how transformers certified at an alternative identified several technology options
their transformers perform in the real PUL as no energy conservation standard that would be expected to improve the
world. (Powersmiths, No. 46 at p. 2) exist at any alternative PUL. Further, efficiency of distribution transformers,
Powersmiths commented that this DOE believes any benefits associated as measured by the DOE test procedure.
practice misleads customers into with a lower PUL are also achieved via Increases in distribution transformer
thinking DOE compliant transformers amended energy conservation efficiency are based on a reduction of
save them the most money, when standards. DOE has presented plots in distribution transformer losses. There
transformers optimized for lower chapter 3 of the TSD to demonstrate are two primary varieties of loss in
loading could save more energy and how the design space of possible load distribution transformers: no-load losses
money. (Powersmiths, No. 46 at p. 2) loss and no-load loss combinations and load losses. No-load losses are
Metglas commented that actual data would change in the presence of roughly constant with PUL and exist
shows current loading is low and as amended energy conservation standards whenever the distribution transformer is
such, the liquid-immersed distribution and if energy conservation standards energized (i.e., connected to electrical
transformers should be evaluated at 35 were evaluated at an alternative PUL power). Load losses, by contrast, are
percent load and LVDTs should be which helps demonstrate this zero at 0 percent PUL but grow
evaluated at 20 percent load. (Metglas, conclusion. quadratically with PUL.
No. 53 at p. 1; Metglas, No. 53 at p. 6) Powersmiths commented that the No-load losses occur primarily in the
Powersmiths added that the 35 current reporting system is flawed as transformer core, and for that reason the
percent PUL for LVDTs produces factors like sub-standard batches of steel terms ‘‘no-load loss’’ and ‘‘core loss’’ are
deceptively high savings estimates and may result in noncompliant distribution sometimes interchanged. Analogously,
pushing up efficiency at that point is transformers being shipped, and ‘‘winding loss’’ or ‘‘coil loss’’ is
sometimes used in place of ‘‘load loss’’ improvement in energy efficiency that is TABLE IV.2—AMORPHOUS STEEL
because load loss arises chiefly in the technologically feasible and TECHNOLOGY OPTIONS
windings. For consistency and clarity, economically justified, and would result
DOE will use ‘‘no-load loss’’ and ‘‘load in the significant conservation of DOE designator in Technology
design options
loss’’ generally and reserve ‘‘core loss’’ energy. Specifically, with regards to
and ‘‘coil loss’’ for when those technological feasibility, products am ......................... Traditional Amorphous Steel.
quantities expressly are meant. achieving these standard levels are hibam .................... High-Permeability Amorphous
CDA commented that copper is the Steel.
already commercially available for all hibam-dr ............... High-Permeability, Domain-Re-
best conductor of electricity and enables product classes covered by this fined, Amorphous Steel.
a more compact and economical proposal. Accordingly, DOE has
distribution transformer with a smaller In the August 2021 Preliminary
proceeded with the proposed standards.
tank, less core, and reduced oil. (CDA, Analysis TSD, DOE requested comment
No. 47 at p. 1) DOE notes that it has 5. Electrical Steel Technology and and data on the quality and differences
included some copper windings in its Market Assessment between the various amorphous steels
engineering analysis and recognizes that on the market. (August 2021
while copper may be more expensive Distribution transformer cores are
Preliminary Analysis TSD at p. 2–31)
than aluminum conductors, it constructed from a specialty kind of
In response, Metglas commented that
represents a technology option that steel known as electrical steel. Electrical
since amorphous steel was introduced,
allows manufacturers to achieve smaller steel is an iron alloy which incorporates
the core loss and stacking factor of the
footprints or higher efficiencies in small percentages of silicon to enhance product has continually improved.
designs that are uniquely difficult to its magnetic properties, including (Metglas, No. 53 at pp. 2–3) Metglas
meet energy conservation standards. increasing its magnetic permeability and stated that the current stacking factors
EEI commented that many reducing the iron losses associated with are between 88–90 percent, which
technologies that decrease no-load magnetizing that steel. Electrical steel is allows amorphous cores to be smaller
losses, increase load losses and produced in thin laminations and either
therefore DOE should utilize accurate than they have historically been.
wound or stacked into a distribution (Metglas, No. 53 at pp. 2–3) Eaton
projections of loading and recognize transformer core shape.
lower-loss core materials can have commented that the hibam material uses
significantly higher load losses. (EEI, Electrical steel used in distribution an 89 percent stacking factor and max
No. 56 at p. 3) transformer applications can broadly be flux of 1.40–1.42 tesla (T), as compared
Regarding amended energy categorized as amorphous steel and to traditional amorphous material which
conservation standards generally, grain-oriented electrical steel (‘‘GOES’’). uses 88 percent stacking factor and a
Howard commented that no new There are many subcategories of steel flux of 1.35–1.37 T. (Eaton, No. 55 at
technology options have come onto the within both amorphous steel and grain- p.11) NEMA commented that the
market that would impact distribution oriented electrical steel. In the August stacking factor of amorphous steel will
transformer efficiency since the April 2021 Preliminary Analysis TSD, DOE never be as high as grain-oriented
2013 Standards Final Rule. (Howard, assigned designated names to identify electrical steel. (NEMA, No. 50 at p. 8)
No. 59 at p. 1) CDA commented that the various permutations of electrical In the August 2021 Preliminary
there should be no new standards and steel. (August 2021 Preliminary Analysis TSD, DOE noted that it did not
recommended DOE continue to evaluate Analysis TSD at pp. 2–31–36) DOE include any designs specifically using
the inputs to its analysis and new the high-permeability amorphous steel.
requested comment on its proposed
technologies. (CDA, No. 47 at p. 2) (August 2021 Preliminary Analysis TSD,
naming convention. In response,
Powermiths noted that the market is in at p. 2–45) DOE stated while there are
Schneider and NEMA commented that
flux currently and recommended DOE some design flexibility advantages
the proposed naming convention used associated with using the high-
delay the rulemaking while the market by DOE in the preliminary analysis is
settles, require third party compliance permeability amorphous steel, it is only
adequate. (Schneider, No. 49 at p. 13; available from a single supplier. Id. In
enforcement, and invite stakeholder into
NEMA No. 50 at p. 8) interviews, manufacturers noted they
DOE’s revision process. (Powersmiths,
No. 46 at p. 7) The various markets, technologies, would be hesitant to rely on a single
With respect to analyzed inputs, in and naming conventions for amorphous supplier of amorphous material for any
the engineering analysis, DOE and GOES are discussed in the higher volume unit. Id. DOE further
considered various combinations of the following sections. stated that high-permeability
following technology options to amorphous steel can be integrated in
improve efficiency: (1) Higher grade a. Amorphous Steel Market and manufacturer existing amorphous
electrical core steels, (2) different Technology designs with minimal changes and
conductor types and materials, and (3) Amorphous steel is a type of electrical therefore, DOE’s amorphous designs
adjustments to core and coil steel that is produced by rapidly cooling represent efficiencies that can be met
configurations. With respect to molten alloy such that crystals do not with any amorphous steel. Id. DOE
commenters’ suggestions that DOE delay requested comment on its assumption
form. The resulting product is thinner
standards or not issue amended that high-permeability amorphous steel
than GOES and has lower core losses,
standards, as noted previously, EPCA could be used in existing amorphous
but it reaches magnetic saturation at a
requires DOE to periodically determine designs with minimal changes. Id.
lower flux density. In response, Metglas commented that

whether more-stringent standards
would be technologically feasible and DOE has identified three sub- hibam can be used interchangeably with
economically justified, and would result categories of amorphous steel as the standard am designs. (Metglas, No.
in significant energy savings. 42 U.S.C. possible technology options. These 53 at p. 4) Metglas added that many
6316(a); 42 U.S.C. 6295(m). DOE has technology options and their DOE transformers will maintain existing am
tentatively concluded that the proposed naming shorthand are shown in Table design and operate the hibam material
standards represent the maximum IV.2. at the lower induction levels during
initial conversion, however, once this product has not been widely used No. 53 at p. 3) NEMA commented that
designs are optimized for the hibam in commercial applications at this point, amorphous steel sourced from China is
material, they cannot substitute DOE has not been able to verify that the more variable in its stacking factor and
standard am because standard am core loss reduction of this product is consistency. (NEMA, No. 50 at p. 8)
cannot reach the higher induction maintained throughout the core Stakeholder comments verify that
levels. (Metglas, No. 53 at p. 4) Metglas production process, and it is only global amorphous capacity is much
added that there is not a reduction in produced by one supplier. greater than current demand and
core losses when operating hibam at the In the April 2013 Standard Final Rule, amorphous is produced by a variety of
same induction levels as standard am. one concern DOE noted with efficiency sources, although the quality may not be
(Metglas, No. 53 at p. 4) levels that would use amorphous steel as consistent from everybody. Through
NEMA and Eaton commented that was that there was only one global manufacturer interviews, DOE learned
hibam does not necessarily have higher supplier of amorphous steel. 78 FR that amorphous production capacity
efficiency than standard am at certain 23336, 23383. In the June 2019 Early increased in response to the April 2013
flux densities, and it is not universally Assessment RFI, DOE estimated global Standards Final Rule, resulting in
true that hibam could be used in place amorphous capacity of 190,000 metric excess capacity because demand for
of standard am without other design tons and noted that the capacity and amorphous steel did not
changes because at some flux densities, number of producers of amorphous steel correspondingly increase. While
standard am can have lower no-load has grown since the April 2013 amorphous capacity today is currently
losses. (Eaton, No. 55 at p. 12–13; Standards Final Rule. 84 FR 28239, less than the total distribution
NEMA, No. 50 at p. 10) 28247 transformer total electrical steel usage,
Stakeholder comments confirm DOE’s Metglas commented that it is the only amorphous producers’ response to the
assumption that hibam material can be current producer of amorphous steel in April 2013 Standards Final Rule
used in place of standard am designs, the United States, however, there is demonstrates that if there was expected
generally, although some specific current production in Japan and China to be a market demand for amorphous
applications may require redesigning. along with amorphous capacity in steel, capacity would increase to meet
As such, including only standard am Germany and South Korea. (Metglas,
that demand.
designs in the NOPR analysis is No. 11 at p. 2) Eaton pointed out that
In interviews, several manufacturers
appropriate to avoid setting efficiency one barrier to steel manufacturers
standards based on a steel type, hibam, producing amorphous is that it would noted that recent increases in prices,
that is only available from a single ‘‘cannibalize’’ conventional electrical and foreign produced GOES prices, in
supplier. Under this approach, steel manufacturers existing product particular, have led amorphous to be far
manufacturers have the option to offering and reduce the equipment more cost competitive. However, the
achieve efficiency levels that require am utilization of existing equipment. industry has not necessarily seen an
steel using either the standard am (Eaton, No. 12 at p. 6) increase in amorphous transformer
material or the hibam material In the August 2021 Preliminary purchasing reflective of this pricing
depending on their sourcing practices Analysis TSD, DOE noted that it had situation. Manufacturers noted that
and preferences. identified numerous companies capable many of their processes are set-up to
In the August 2021 Preliminary of producing amorphous material (of produce and process GOES steel and as
Analysis TSD, DOE noted that it was standard am quality or better). DOE such there is some degree of bias against
aware of a hibam material that uses stated that it did not apply any capacity amorphous transformers, regardless of
domain refinement (‘‘hibam-dr’’) to constraints on the number of amorphous what the first cost of a product is. In the
further reduce core losses but did not distribution transformers that could be August 2021 Preliminary Analysis TSD,
have sufficient data or details as to selected because amorphous capacity is DOE requested comment and data on
whether it is commercially available. much greater than amorphous demand. the current amorphous core making
(August 2021 Preliminary Analysis TSD, The Efficiency Advocates commented capacity and the cost and time frame to
at p. 2–31) In response, Metglas that the preliminary analysis shows a add amorphous core production
commented that they have introduced a transition to amorphous material is cost capacity. (August 2021 Preliminary
mechanically domain refined hibam justified and would bring U.S. standards Analysis TSD at p. 2–33)
material that lowers core losses by an in-line with other parts of the world. In response, Metglas estimated
additional 20–30 percent in a finished (Efficiency Advocates, No. 52 at p. 1) amorphous core making capacity to be
core at a constant operating induction The Efficiency Advocates added that if approximately 20,000 to 25,000 metric
and there is a laser domain refined amorphous core availability is a tons and noted that bringing on
hibam product in the Asian market that concern, DOE could require amorphous additional amorphous core
Metglas is working to bring online in the cores for certain transformer types that manufacturing is relatively
domestic market. (Metglas, No. 53 at p. offer large savings. (Efficiency straightforward and inexpensive.
3) Metglas commented that hibam-dr Advocates, No. 52 at p. 8) (Metglas, No. 53 at p. 4) Metglas
allows manufacturers to increase Metglas estimated global amorphous commented that there are conversion
operating induction, relative to standard capacity to be 150,000 metric tons costs and capital costs associated with
am, while reducing core losses by annually with domestic capacity of producing an amorphous core from
approximately 14 percent relative to the 45,000 metric tons and ready ability to amorphous steel laminations. (Metglas,
standard am operating induction. add another 75,000 metric tons within No. 53 at p. 5) Eaton commented that
18–24 months. (Metglas, No. 53 at p. 3) the timeframe to add additional
(Metglas, No. 53 at p. 4)
DOE further investigated this product Metglas commented that the high- amorphous transformer capacity is
in manufacturer interviews conducted permeability amorphous grades (hibam) dependent on whether additional design
for this NOPR analysis. In these has been widely adopted by the North qualification testing is needed versus
interviews, DOE learned that the hibam- American market, making up 80 percent strictly capacity expansion and
dr product is not yet widely available of their production, and allows for estimated one years for the former and
commercially. DOE has not included the higher operating inductions which one year for the latter. (Eaton, No. 55 at
hibam-dr product in its analysis because reduces amorphous core sizes. (Metglas, p. 11)
In the NOPR analysis, DOE has not specific designator, followed by the tends to be served before the dry-type
applied any constraints to standard am guaranteed core loss of that steel in W/ distribution market.
steel purchasing in its evaluation of kg at 1.7 Tesla (‘‘T’’) and 50 Hz. Power Regarding availability of GOES more
higher efficiency levels. DOE did in the U.S. is delivered at 60 Hz and the generally, NEMA recommended DOE
constrain the selection of amorphous flux density can vary based on review the DOC study for perspective on
steel under the no-new-standards distribution transformer design, steel availability. (NEMA, No. 50 at p.
scenario to better match the current therefore the core losses reported in the 8) NEMA and Powersmiths commented
market share of amorphous distribution steel name are not identical to their that recently there has been a notable
transformers, as discussed in section performance in the distribution increase in competition from the auto
IV.F.2 of this document. DOE notes that transformer. However, the naming industry for electrical steel to produce
any conversion costs associated with a convention is generally a good indicator electric motors in EVs. (NEMA, No. 50
transition from GOES production to of the relative performance of different at p. 9; Powersmiths, No. 46 at p. 5)
amorphous distribution transformer steels. NEMA and Powersmiths stated that
production would be accounted for in In the August 2021 Preliminary some steel suppliers are shifting part of
the manufacturer impact analysis in Analysis TSD, DOE identified several their grain-oriented electrical steel
section IV.J. grades of GOES as potential technology production capacity to non-oriented
options for distribution transformers. electrical steel production—limiting the
b. Grain-Oriented Electrical Steel DOE requested comment and data on availability and increasing prices of
Market and Technology the availability of those steels, the transformer-grade steels. (NEMA, No. 50
GOES is a type of electrical steel that ability to substitute various GOES at p. 9; Powersmiths, No. 46 at p. 5) At
is processed with tight control over its grades for one another, any potential the Public meeting, a representative
crystal orientation such that its competition for steel supply for the from Carte commented that one major
magnetic flux density is increased in the large power transformer market, and the foreign steel manufacturer transitioned
direction of the grain-orientation. The costs for steelmakers to add or convert 50 percent of their grain-oriented
single-directional flow is well suited for capacity to higher performing GOES. production lines to non-oriented.
distribution transformer applications (August 2021 Preliminary Analysis TSD (Zarnowski, Public Meeting Transcript,
and GOES is the dominant technology at pp. 2–36–37) No. 40 at p. 36) A representative from
in the manufacturing of distribution Regarding potential competition for LakeView Metals, commented that the
transformer cores. GOES is produced in steel supply with the large power non-oriented market is skyrocketing and
a variety of thickness and with a variety transformer industry, Schneider there is an estimated global shortfall of
of loss characteristics and magnetic commented that power transformers and 13 silicon production lines. (Looby,
saturation levels. In certain cases, steel medium-voltage distribution Public Meeting Transcript, No. 40 at p.
manufacturers may further enhance the transformers tend to be prioritized over 37)
performance of electrical steel by the needs of the LVDT market and Powersmiths commented they are
introducing local strain on the surface of therefore supply issues can exist if currently experiencing diminished
the steel, through a process known as LVDT manufacturers need to purchase availability of several grades of steel and
domain-refinement, such that core the same core steel as medium-voltage increased costs as steel suppliers are
losses are reduced. This can be done via distribution transformers. (Schneider, shifting to serving the EV market
different methods, some of which No. 49 at p. 14) Cliffs added that while without plans to bring transformer-grade
survive the distribution transformer core high-permeability GOES works well in steel capacity back. (Powersmiths, No.
annealing process. distribution transformers, it has 46 at p. 5) ERMCO agreed that supply
In the August 2021 Preliminary historically been sold as a laser DR of steel is currently limited and they
Analysis TSD, DOE identified four sub- product to the power transformer have been able to obtain M3 steel, some
categories of GOES as possible market. (Cliffs, No. 57 at p. 1) hib, and am steel. (ERMCO, No. 45 at p.
technology options. (August 2021 Conversely, NEMA suggested that 1)
Preliminary Analysis TSD at p. 2–35) electrical steels used in the large power Recent supply issues and increases in
These technology options and their DOE transformer industry cannot be used in costs are likely associated with a
naming short-hand are shown in Table distribution applications, stating that combination of general commodity
IV.3. the packaging and coating of steels related supply chain issues and
targeting the large power transformer competition from electric vehicles. DOE
TABLE IV.3—GOES STEEL industry are not compatible with notes that variability in electrical steel
distribution transformer designs but prices and supply is not new and
TECHNOLOGY OPTIONS
added that large power transformers do historically, DOE averages prices to
DOE designator compete for steel demand. (NEMA, No. come up with a representative value. As
Technology 50 at p. 9) part of the August 2021 Preliminary
in design options
Steel manufacturer literature Analysis TSD, DOE did evaluate
M-Grades ........... Conventional (not high- generally markets GOES, and in alternative price scenarios. DOE has
permeability) GOES. particular hib and dr GOES, as suitable applied a 5-year average price in its base
hib ...................... High-Permeability GOES. for use in either power or distribution case analysis and conducted
dr ........................ Non-Heat Proof, Laser transformers. Generally, a steel that is
Domain-Refined, High-
sensitivities for various other pricing
Permeability GOES.
suitable for use in a power transformer scenarios, as discussed in section
may be suitable for use in a distribution
pdr ...................... Heat-Proof, Permanently IV.C.3. DOE has also screened-out some
Domain-Refined, High- transformer. As Schneider noted, and of the highest performing GOES, where
Permeability GOES. DOE confirmed in manufacturer steel manufacturers are not able to mass
interviews, power transformers tend to produce GOES of similar quality, as
DOE noted that for high-permeability have priority and get the highest discussed in section IV.B.
steels, steel manufacturers have largely performing GOES. The industry also is NEMA previously noted that there is
adopted a naming convention that volume driven and as such, the larger currently only one domestic producer of
includes the steel’s thickness, a brand volume of the liquid-immersed market GOES and that the sole domestic
producer does not have the capacity of (2) producing the distribution have access to the entire global market
high-grade electrical steel to serve the transformer core and finished of electrical steel types and prices
entire U.S. market, meaning the U.S. transformer in a foreign country and without the additional 25 percent tariff.
would be dependent on foreign importing into the United States; (3) However, these manufacturers may
electrical steel producers. (NEMA, No. purchasing distribution transformer require increased management of
13 at p. 6–7) cores and producing only the finished electrical steel supply chains, as they
Powersmiths commented that many of transformer domestically. Each of these are often purchasing electrical steel
the high performing grades are only pathways has unique advantages and from overseas producers which may
available from overseas suppliers and disadvantages which manufacturers have longer lead times than sourcing
recent shipping and port access have employed to maintain a electrical steel from domestic sources.
challenges have increased market competitive position. Similar to domestic manufacturers,
uncertainty and availability to those First, manufacturers who produce DOE assumes that in the presence of
grades. (Powersmiths, No. 46 at p. 6) distribution transformer cores and amended standards, those
Powersmiths stated that increased finished transformers domestically are manufacturers producing both cores and
domestic capacity for GOES would able to maintain greater control of their transformers outside the United States
require significant investment from lead times, potentially offering shorter would still value the advantages of in-
industry and take years to come on. lead times to their customers. This is house core production and would
(Powersmiths, No. 46 at p. 6) Cliffs particularly advantageous in servicing change their in-house production
added that high-permeability GOES is a emergency applications with unique processes to accommodate the required
unique production line that would take characteristics. This manufacturing core production equipment or required
years of planning, installation, and approach is more common in certain electrical steel grades.
commissioning to convert existing M3 liquid-immersed and medium-voltage Third, manufacturers who purchase
lines to high-permeability. (Cliffs, No. dry-type applications, where customers cores to manufacture distribution
57 at pp. 1–2) Cliffs stated that domestic may have unique voltage specifications transformers are able to avoid the labor
steel is currently well-suited to serve that may not be routinely produced by and capital equipment associated with
distribution applications and higher all manufacturers but may be required producing transformer cores. In part for
standards would negatively impact the on short notice. this reason, it is increasingly common
ability of domestic steel manufacturers As discussed, however, there is among small businesses. Further,
to serve the distribution transformer currently only one domestic because distribution transformer cores
market. (Cliffs, No. 57 at p. 2) Cliffs manufacturer of grain-oriented electrical are not subject to tariffs, purchasing
commented that higher efficiency levels steel and one domestic manufacturer of cores also allows manufacturers to more
would drastically hurt M3, and amorphous steel. Under the current easily transition between various steel
correspondingly domestic market dynamics with tariffs applied to grades and various steel suppliers, both
manufacturing, leaving the only all, raw imported electrical steel, these international and domestic. Similarly, it
domestic products as M2 and some manufacturers are limited in where they is easier for manufacturers who
high-permeability GOES grades. (Cliffs, can source their raw steel. As such, they outsource cores to transition between
No. 57 at p. 1) Cliffs commented that its may not have access to all of the types GOES and amorphous steel grades since
electrical steel is produced with of steels available in the global market it eliminates the need to use different
recycled steel scrap in an electric arc and may have different material prices core production equipment for each
furnace, making it some of the greenest from foreign core producers. While in steel type as the process of converting
steel in the world. (Cliffs, No. 57 at p. theory, these manufacturers have the a core into a transformer is relatively
1) option to purchase electrical steel from similar for both GOES and amorphous
DOE did constrain the selection of foreign producers, they would be steels.
electrical steel under the no-new- subject to the 25-percent tariff. The primary disadvantages of
standards scenario to better match the Similarly, in theory, they have the outsourcing cores are that (1)
current market share of electrical steel, option to purchase either grain-oriented transformer manufacturers may have
as discussed in section IV.F.2. In its electrical steel or amorphous electrical less control over core, and therefore
evaluation of future standards, DOE steel domestically. transformer, delivery lead times and (2)
assumed that steel manufacturers would DOE assumes that in the presence of transformer manufacturers will pay a
provide the electrical steel qualities amended standards, those higher cost per pound of steel because
required by the market. In cases where manufacturers currently producing both they are purchasing partially processed
fewer steel suppliers offer a grade of cores and finished transformers products as compared to manufacturers
GOES, this is reflected by higher prices domestically would still value the who are producing their own cores.
in DOE’s analysis. advantages of in-house domestic core DOE assumes that in the presence of
production and would change their in- amended standards, these
6. Distribution Transformer Production house production processes to manufacturers would switch from
Market Dynamics accommodate the required core purchasing one grade of electrical steel
Distribution transformer production equipment or required core to a higher grade of electrical steel
manufacturers either make or buy electrical steel grades. core.
transformer cores; some do both. Second, for manufacturers producing In summary, DOE does not view any
Further, distribution transformer both the distribution transformer core one of these core and transformer
manufacturers may choose to produce and finished transformer in a foreign production pathways as necessarily
transformers domestically or produce country and importing into the United becoming more advantaged or
them in a foreign country and import States, they are able to control the in- disadvantaged in light of the standards
them to the United States. This creates house core production and therefore proposed in this notice relative to the
three unique pathways for producing have similar advantages to those present. In the current market, all three
distribution transformers: (1) producing producing cores domestically. Further, pathways act as viable options for
both the distribution transformer core because finished transformer imports manufacturers to find and maintain a
and finished transformer domestically; are not currently subject to tariffs, they competitive position. DOE does not
have a reason to believe that the excluded from further consideration in temperature could be too high for
proposed standards would alter the the engineering analysis. The reasons consumers to safely interact with.
ways in which distribution transformer for eliminating any technology are Therefore, DOE has screened out LFLI
manufacturers approach manufacturing discussed in the following sections. as a potential technology option.
or their current sourcing decisions given The subsequent sections include Regarding evaluating efficiency
all three productions options continue comments from interested parties improvements associated with certain
to be available. DOE seeks comment on pertinent to the screening criteria, high-performing GOES grades,
the distribution transformer market and DOE’s evaluation of each technology Powersmiths commented that the
whether the standards proposed will option against the screening analysis stability of availability, cost, and batch
alter the current production pathways. criteria, and whether DOE determined quality of some new steel grades is
that a technology option should be unproven. (Powersmiths, No. 46 at p. 5)
B. Screening Analysis excluded (‘‘screened out’’) based on the Schneider expanded that steel mills are
DOE uses the following five screening screening criteria.
not perfectly consistent and only a
criteria to determine which technology 1. Screened-Out Technologies portion of their production may meet a
options are suitable for further target loss performance. As such, it may
consideration in an energy conservation In the August 2021 Preliminary
Analysis TSD, DOE identified core not be feasible to set efficiency levels
standards rulemaking: based on premium grades, for example
(1) Technological feasibility. deactivation as a potential technology
option to improve efficiency but noted an 075 or 070 grade steel, as steel
Technologies that are not incorporated manufacturers may not be able to
in commercial products or in working that it was not a generally accepted
practice and would be associated with consistently achieve the premium
prototypes will not be considered performance. (Schneider, No. 49 at p.
further. system wide savings, not savings as
measured by DOE’s test procedure. 14) Schneider added that some higher
(2) Practicability to manufacture,
In response, NEMA commented that performance steels are published in
install, and service. If it is determined
core deactivation would only be steel maker catalogs but are not widely
that mass production and reliable
beneficial in certain settings and there available for commercial use.
installation and servicing of a
are questions of reliability associated (Schneider, No. 49 at p. 13)
technology in commercial products
could not be achieved on the scale with shifting load which could lead to In GOES production, the product steel
necessary to serve the relevant market at shorter lifetimes. (NEMA, No. 50 at p. 7) losses can vary somewhat between and
the time of the projected compliance NEEA commented that core deactivation within batches. Because of this
date of the standard, then that may impact maintenance of switchgear variability in electrical steel, producers
technology will not be considered and other connected equipment. (NEEA, typically offer two loss specifications for
further. No. 51 at p. 5) their steels, a guaranteed core loss and
Due to the concerns cited by NEMA a typical core loss. While some of the
(3) Impacts on product utility or
and NEEA regarding impacts on product premium products identified in the
product availability. If it is determined
lifetime and servicing of equipment, August 2021 Preliminary Analysis TSD
that a technology would have a
along with the fact that core generally exist and are used in the
significant adverse impact on the utility
deactivation would not impact the market, they represent the upper end of
of the product for significant subgroups
efficiency as measured by the DOE test the distribution of product performance.
of consumers or would result in the procedure, DOE has screened-out core
unavailability of any covered product As commenters suggested, without
deactivation as a potential technology further improvements in consistency of
type with performance characteristics option.
(including reliability), features, sizes, batch quality, it may not be reasonable
DOE also identified less-flammable to assume these products could be
capacities, and volumes that are insulating liquid-immersed distribution
substantially the same as products widely used in industry. Therefore, DOE
transformer (‘‘LFLI’’) as a potential has screened out certain high-
generally available in the United States technology by which manufacturers
at the time, it will not be considered performing GOES products.
could increase the capacity of a Specifically, DOE removed 23pdr075
further. distribution transformer without
(4) Adverse impacts on health or and 20dr070 electrical steels from its
increasing the size, potentially leading engineering modeling due to concerns
safety. If it is determined that a to energy savings. In response, NEMA
technology would have significant with its practicability to manufacture.
commented that while LFLI is used by DOE notes that these electrical steels
adverse impacts on health or safety, it some customers to reduce unit size,
will not be considered further. could be used in certain applications
particularly for pad mounts but rarely but DOE has screened them out because
(5) Unique-Pathway Proprietary for pole mounts, it is generally pursued
Technologies. If a design option utilizes of concerns that mass production of
for greater reliability and not greater these products could not be achieved on
proprietary technology that represents a efficiency. (NEMA, No. 50 at pp. 7–8)
unique pathway to achieving a given the scale necessary to serve the
DOE notes that while there may be
efficiency level, that technology will not distribution transformer market.
opportunity for a customer to maintain
be considered further due to the distribution transformer lifespan while DOE listed several other technology
potential for monopolistic concerns. increasing the loading on a transformer options in the August 2021 Preliminary
10 CFR 431.4; 10 CFR part 430, subpart with LFLI technology, this would not Analysis TSD for which it did not
C, appendix A, sections 6(b)(3) and 7(b) impact the efficiency as measured by receive any comment. As such, DOE has
(‘‘Process Rule’’). DOE’s test procedure. Further, DOE retained those technology options as
In summary, if DOE determines that a understands that there are potential screened out.
technology, or a combination of consumer safety concerns with Technology options screened out are
technologies, fails to meet one or more distribution transformers operating listed in Table IV.4 with their bases for
of the listed five criteria, it will be notably hotter, namely that the touch screening.
TABLE IV.4—SCREENED-OUT TECHNOLOGIES

Technology option Basis for screening
Core Deactivation ........................... Practicability to manufacture, install, and service; Adverse Impacts on Product Utility or Product Availability.
Less-Flammable Insulating Liquids Adverse Impacts on Health or Safety.
Symmetric Core Design .................. Practicability to manufacture, install, and service.
23pdr075 and 23dr070 GOES Steel Practicability to manufacture, install, and service.
Silver as a Conductor Material ....... Practicability to manufacture, install, and service.
High-Temperature Superconductors Technological feasibility; Practicability to manufacture, install and service.
Amorphous Core Material in Technological feasibility; Practicability to manufacture, install, and service.
Stacked Core Configuration.
Carbon Composite Materials for Technological feasibility.
Heat Removal.
High-Temperature Insulating Mate- Technological feasibility.
rial.
Solid-State (Power Electronics) Technological feasibility; Practicability to manufacture, install, and service.
Technology.
Nanotechnology Composites .......... Technological feasibility.
2. Remaining Technologies are used in downstream analyses (i.e., equipment class 1. Therefore, RU3 has
the LCC and PBP analyses and the NIA). been retained in this NOPR.
Through a review of each technology, Carte commented that the
DOE tentatively concludes that the 1. Representative Units representative units used by DOE are
remaining combinations of core steels, representative of common/typical sizes
windings materials and core Distribution transformers are divided
into different equipment classes, but the extremes were not analyzed,
configurations as combinations of where meeting efficiency standards tend
‘‘design options’’ for improving categorized by the physical
characteristics that affect equipment to be the hardest. (Carte, No. 54 at p. 1)
distribution transformer efficiency met Carte added that certain designs are
all five screening criteria to be examined efficiency. DOE’s current energy
conservation standards at 10 CFR forced to use high-end grain-oriented
further as design options in DOE’s electrical steel and copper windings or
NOPR analysis. 431.196 divide distribution transformers
based on the following characteristics: in certain cases are unable to be met by
DOE has initially determined that Carte. (Carte, No. 54 at p. 1)
(1) capacity (kVA rating), (2) voltage
these technology options are Eaton commented that the
rating, (3) phase count, (4) insulation
technologically feasible because they are representative units are good choices for
category (e.g., ‘‘liquid-immersed’’), and
being used or have previously been used the highest volume transformers,
(5) BIL rating.
in commercially-available products or however, as efficiency standards
working prototypes. DOE also finds that Because it is impractical to conduct
increase, efficiency standards may not
all of the remaining technology options detailed engineering analysis at every
be achievable at the scope extremes.
meet the other screening criteria (i.e., kVA rating, DOE conducts detailed
(Eaton, No. 55 at p. 12)
practicable to manufacture, install, and modeling on ‘‘representative units’’ It is true that certain extreme designs
service and do not result in adverse (‘‘RUs’’). These RUs are selected both to may have more difficulty achieving
impacts on consumer utility, product represent the more common designs efficiency standards while still being
availability, health, or safety, unique- found in the market and to include a requested by consumers. Most
pathway proprietary technologies). For variety of design specification to enable applications would generally be able to
additional details, see chapter 4 of the generalization of the results. In the use amorphous steel to achieve higher
NOPR TSD. August 2021 Preliminary TSD, DOE efficiencies, including at efficiency
presented 14 representative units and levels beyond DOE’s max-tech. DOE
C. Engineering Analysis noted they were unchanged from the selected design units to include both
The purpose of the engineering April 2013 Standards Final Rule. large and small distribution
analysis is to establish the relationship (August 2021 Preliminary TSD at p. 2– transformers across the various
between the efficiency and cost of 41) representative units and DOE’s
distribution transformers. There are two In response to the August 2021 modeling of the selected representative
elements to consider in the engineering Preliminary TSD, Howard commented units includes amorphous designs
analysis; the selection of efficiency that RU3 is not a very good which achieve efficiencies above DOE’s
levels to analyze (i.e., the ‘‘efficiency representative unit because it is not max-tech for all RUs. This indicates that
analysis’’) and the determination of common and should be replaced with a there is room for even extreme designs
product cost at each efficiency level more common unit. (Howard, No. 59 at to meet efficiency standards using
(i.e., the ‘‘cost analysis’’). In determining p. 2) DOE agrees that RU3, technologies modeled by DOE.
the performance of higher-efficiency corresponding to a 500 kVA, single- DOE requests data demonstrating any
equipment, DOE considers technologies phase, liquid-immersed distribution specific distribution transformer designs
and design option combinations not transformer, is generally larger than the
that would have significantly different

eliminated by the screening analysis. more common capacities included in cost-efficiency curves than those
For each equipment class, DOE equipment class 1. However, as noted, representative units modeled by DOE.
estimates the baseline cost, as well as DOE’s RUs are designed to include both To assess the impact of expanding the
the incremental cost for the equipment common units and units included to scope of the definition of ‘‘distribution
at efficiency levels above the baseline. improve generalization. RU3 is included transformer’’ in 10 CFR 431.192 to
The output of the engineering analysis to improve scaling of results to the include distribution transformers up to
is a set of cost-efficiency ‘‘curves’’ that larger units within the scope of 5,000 kVA, DOE is evaluating three new
RUs. DOE scaled the results for RU5, stainless steel to represent the corrosion In this rulemaking, DOE relies on an
RU12, and RU14 to represent RU17, resistant properties of submersible incremental efficiency (design-option)
RU18, and RU19, respectively, each of distribution transformers. All other approach. This approach allows DOE to
which are rated at 3,750 kVA. Results physical properties of the distribution investigate the wide range of design
were generated for RU17, RU18, and transformer are the same. option combinations, including varying
RU19 using the scaling rules for DOE requests comment on its the quantity of materials, the core steel
dimensions, transformer weight, no-load methodology for modifying the results material, primary winding material,
losses, load losses, etc., as described in of RU4 and RU5 to represent the secondary winding material, and core
Appendix 5C of the TSD. efficiency of submersible liquid- manufacturing technique.
DOE notes that it only includes immersed units. For other potentially For each representative unit analyzed,
distribution transformers in the disadvantaged designs, DOE has DOE generated hundreds of unique
downstream analysis that would meet or considered establishing equipment designs by contracting with Optimized
exceed current energy conservation classes to separate out those that would Program Services, Inc. (‘‘OPS’’), a
standards. Because RU17, RU18, and have the most difficulty achieving software company specializing in
RU19 represent an expansion in scope, amended efficiency standards, as distribution transformer design. The
they are not currently subject to energy discussed in section IV.A.2, but OPS software used two primary inputs:
conservation standards. As such, all ultimately has determined not to (1) a design option combination, which
modeled designs are included in the include such separate equipment classes includes core steel grade, primary and
downstream analysis, regardless of in the proposed standards. However, secondary conductor material, and core
efficiency and DOE relies on the DOE requests data as to the degree of configuration, and (2) a loss valuation.
consumer choice model to determine reduction in efficiency associated with DOE examined numerous design
the efficiency of distribution various features. option combinations for each
transformers selected at baseline. DOE representative unit. The OPS software
2. Efficiency Analysis
has described these results and shown generated 518 designs for each design
the cost-efficiency curves for these DOE typically uses one of two option combination based on unique
scaled units in Chapter 5 of the TSD. approaches to develop energy efficiency loss valuation combinations. Taking the
DOE requests comment on its levels for the engineering analysis: (1) loss value combinations, known in the
methodology for scaling RU5, RU12, relying on observed efficiency levels in industry as A and B values and
and RU14 to represent the efficiency of the market (i.e., the efficiency-level representing the commercial consumer’s
units above 3,750 kVA. approach), or (2) determining the present value of future no-load and load
Distribution transformers designed for incremental efficiency improvements losses in a distribution transformer,
submersible applications may be associated with incorporating specific respectively, the OPS software sought to
disadvantaged in meeting efficiency design options to a baseline model (i.e., generate the minimum total ownership
standards on account of having to meet the design-option approach). Using the cost (‘‘TOC’’). TOC can be calculated
efficiency standards with reduced efficiency-level approach, the efficiency using the equation below.
cooling ratings. To explore this levels established for the analysis are
specification limitation, DOE has determined based on the market TOC = Transformer Purchase Price + A
proposed a definition for submersible distribution of existing products (in * [No Load Losses] + B * [Load
distribution transformers. In this NOPR, other words, based on the range of Losses]
DOE is evaluating those submersible efficiencies and efficiency level From the OPS software, DOE received
distribution transformers as a separate ‘‘clusters’’ that already exist on the thousands of different distribution
equipment class. DOE has modified the market). Using the design option transformer designs, including physical
engineering results for RU4 and RU5 to approach, the efficiency levels characteristics, loading and loss
represent two new RUs, RU15 and established for the analysis are behavior, and bill of materials. DOE
RU16. RU15 and RU16 represent determined through detailed used these distribution transformer
common three-phase submersible engineering calculations and/or designs, supplemented with
distribution transformers. To account computer simulations of the efficiency confidential and public manufacturer
for the thermal derating that is improvements from implementing data, to create a manufacturer selling
associated with submersible distribution specific design options that have been price (‘‘MSP’’). The MSP was generated
transformers, DOE evaluated RU15 and identified in the technology assessment. by applying material costs, labor
RU16 as having their nameplates DOE may also rely on a combination of estimates, and various mark-ups to each
derated by one standard kVA size these two approaches. For example, the design given from OPS.
relative to the efficiency of RU4 and efficiency-level approach (based on The engineering result included
RU5. That is, while RU4 is a 150 kVA actual products on the market) may be hundreds of unique distribution
three-phase, liquid-immersed extended using the design option transformer designs, spanning a range of
distribution transformer, RU15 is a approach to ‘‘gap fill’’ levels (to bridge efficiencies and MSPs. DOE used this
112.5 kVA three-phase, liquid- large gaps between other identified data as the cost versus efficiency
immersed, submersible distribution efficiency levels) and/or to extrapolate relationship for each representative
transformer. Similarly, while RU5 is a to the max-tech level (particularly in unit. DOE then extrapolated this
1,500 kVA three-phase, liquid-immersed cases where the max-tech level exceeds relationship, generated for each
distribution transformer, RU16 is a the maximum efficiency level currently representative unit, to all the other,
1,000 kVA three-phase, liquid-immersed
available on the market). unanalyzed, kVA ratings within that

distribution transformer. DOE Howard commented that there were same equipment class.
calculated the efficiency of RU15 and inconsistencies in the efficiency levels In the August 2021 Preliminary
RU16 based on their new nameplate and presented in the webinar and the Analysis TSD, DOE stated that it
assuming no-load losses are the same August 2021 Preliminary Analysis TSD. maintained the existing designs from
and load losses scale with the quadratic (Howard, No. 59 at p. 2) DOE notes that the previous rulemaking and updated
of load. DOE also modified the cost of corrected values are presented in this the material prices to get an updated
the tank material from carbon steel to analysis. manufacturer selling price. (August
2021 Preliminary Analysis TSD, at p. 2– redesigns. (Schneider, No. 49 at pp. 14– this annealing, laser-scribed domain-
45) 15) Powersmiths and ERMCO refined steels lose the core loss benefit
Howard commented that while commented that this approach does not of the domain-refinement. As such, DOE
updating pricing to $2020 still gives lead to optimized designs. did not include any laser-scribed
valid designs, reoptimizing with new (Powersmiths, No. 46 at p. 4; ERMCO, domain-refined steels in distributed gap
pricing would have given more accurate No. 45 at p. 1) NEMA commented that wound core design option
results. (Howard, No. 59 at p. 2) it is an oversimplification to assume combinations. DOE requested comment
DOE agrees that the most accurate that substituting of lower loss steel will on this decision.
results would be achieved by lead to improved efficiency for a given In response, NEMA and Schneider
reoptimizing designs under current design. (NEMA, No. 50 at p. 10) NEEA supported DOE’s decision not to include
market practices. However, as commented that DOE should not use laser DR products in wound core
commenters have attested, prices for this approach because new material may constructions. (Schneider, No. 49 at p.
many of the components making up have different B–H curves and while it 15; NEMA, No. 50 at p. 11) Similarly,
distribution transformers are varied. may be possible to use a direct swap— Eaton agreed with DOE’s decision not to
Further, manufacturers may make it generally isn’t an acceptable practice. include laser-scribed domain-refined
different optimization decisions (NEEA, No. 51 at pp. 5–6) The steels in wound cores but noted that
depending on their unique supply Efficiency Advocates recommended larger, three-phase units may be able to
chains and manufacturing capacities. It DOE conduct new modeling as use laser-scribed domain-refined steels
would be impractical for DOE to manufacturers who didn’t optimize for in wound cores if an AEM Unicore
reoptimize all designs with every new material would be at a competitive machine is used and the products are
change in material prices and to disadvantage. (Efficiency Advocates, not annealed. (Eaton, No. 55 at p. 13)
represent the specific supply chains of No. 52 at pp. 6–7) DOE agrees with Eaton that in certain
each manufacturer. To account for the In response to stakeholder feedback, scenarios it may be possible to use laser-
variability in designs, DOE relies on a DOE ran new modeling for some design scribed dr products in wound core. But
wide range of A and B values to initially option combinations included in the as Eaton described, the dr
develop designs reflective of the whole NOPR. DOE compared this new characteristics are only maintained if
design space, not specific to any given modeling to its models that were the core is not annealed. An unannealed
day’s pricing. DOE relies on 5-year established by swapping core steels and core is going to have greater losses
average material pricing in its base has presented some of these associated with the stresses from the
analysis and conducts additional comparisons in chapter 5 of the TSD. bending of the electrical steel. So, the
sensitivities to encompass additional DOE notes that modeled designs may be loss reduction associated with the better
pricing scenarios. Further, DOE’s slightly different at a given A and B performing laser dr product is going to
analysis of various efficiency levels value as compared to the direct swap of be countered by increased losses
includes a consumer choice model that core steels. However, across the range of associated with stresses from bending
selects a sub-set of designs based on the A and B values included in the the steel without annealing. As such,
minimum MSP within a band-of- engineering analysis, and specifically at this approach does not necessarily
equivalence for a given efficiency level. the minimum MSP for a given reflect a higher efficiency product, but
As such, DOE’s efficiency levels are not efficiency, the cost-efficiency curves are rather a similar performing product to
reflective of any one distribution very similar. While DOE intends to using hib steel without domain-
transformer, but rather are designed to update all the engineering designs to refinement and annealing the core. DOE
reflect the variety of distribution newly modeled designs to instill greater did not receive any opposition to its
transformers customers would purchase confidence in the analysis, some core decision to not include laser-scribed dr
at a given efficiency level. steel swap designs are still used in the steels in its wound core designs and
In the August 2021 Preliminary NOPR in order to ensure quick therefore maintained that approach in
Analysis TSD, DOE noted that it publication of the NOPR. These designs the NOPR analysis.
adapted models of grain-oriented are noted in chapter 5 of the TSD. Given Regarding some of the specific design
electrical steel to reflect some of the the similarities between the modeled option combinations presented in the
lower loss steels that have come onto designs and the direct swap of steel August 2021 Preliminary Analysis TSD,
the market since the previous designs, DOE believes the updated NEMA commented that GOES with
rulemaking. Specifically, DOE stated modeling will not notably impact performance lower than M4 is not used
that it estimated the core loss of a analysis results. due to performance limitations. (NEMA,
similar design by multiplying the no- No. 50 at p. 8) Eaton commented that
load loss by the ratio of the core losses a. Design Option Combinations M5 isn’t really used anymore and can be
at a given flux density between two As discussed, for each representative removed from RU4 engineering plots.
steels. DOE noted that while these unit, DOE evaluates various design Eaton also commented that M4 isn’t
designs would not be true optimal option combinations, which includes really used in RU5 designs and can be
designs, given that lower loss steel combinations of electrical steel, removed from DOE’s engineering plots.
allows more flexibility in the load conductor material, and core (Eaton, No. 55 at p. 20) Eaton
losses, however, stated that because construction techniques. In the August commented that an Evans core
DOE’s designs cover such a wide range 2021 Preliminary Analysis TSD, DOE transformer is not a valid option for
of A and B values, the results would be presented the various design option wye-wye distribution transformers but
combinations it used for each
sufficiently accurate. DOE requested noted that it was a moot point since the
feedback on this approach. (August representative unit. DOE noted that costs are greater. (Eaton, No. 55 at p. 20)
2021 Preliminary Analysis TSD at p. 2– distributed gap wound cores typically DOE acknowledges that some designs
46) need a high-temperature annealing would be unlikely to be considered by
Schneider commented that assuming process to relieve some of the stresses many purchasers, but the engineering
the core losses of a swapped steel may associated with the core winding analysis is designed to explore the
be accurate for small reductions in core process. (August 2021 Preliminary whole design space. The specific
loss but bigger jumps could result in full Analysis TSD at p. 2–46) As a result of combinations identified by NEMA and
Eaton generally do not impact the primary voltages, the data didn’t span percent load and corrected from the
analysis due to the first-cost of the the whole design space in all cases, modeled operating temperature to
product being too high and are included much of the data was prior to DOE’s reference temperature.
for completeness of the analysis. implementation of the energy Rather than trying to estimate the
Regarding use of thinner steels, conservation standards as amended in rated efficiency of the public utility bid
NEMA commented that thinner GOES is the April 2013 Standards Final Rule data from full load losses at rated
more difficult to use, but not overly (Effective January 1, 2016), and there temperature rises and make
burdensome, whereas amorphous is a was significant price variability at every generalization as to how temperature
different thickness and width and efficiency. (August 2021 Preliminary would influence efficiency at rated PUL,
cannot be dropped in. (NEMA, No. 50 Analysis TSD at p. 2–45) Rather than DOE has looked at how the no-load and
at p. 9) Cliffs added that while there are drawing any conclusions from this data, full load losses of the bid data compare
specific applications where M2 is DOE relied on the reported no-load loss to the full load losses of the DOE
suitable, nearly all EOMS have stated it and full-load loss to estimate efficiency. modeled data. These comparisons are
is not amenable to their manufacturing DOE then presented the raw material shown in chapter 5 of the TSD. The
processes as it is thin and prone to prices and attempted to correct the comparisons show that DOE’s modeled
folding and tearing in core making material prices to show. data aligns well with the design space
equipment. (Cliffs, No. 57 at p. 1) The Efficiency Advocates commented of the public utility bid data.
DOE includes additional costs that the bid data shows significant In comparing DOE’s modeled results
associated with handling of thinner differences in MSP and indicates that to the public utility bid data, DOE
electrical steels, as described in chapter the engineering analysis need to be realized that for RU4 and RU5, DOE
5 of the TSD. While M2 is included in updated to reflect up-to-date materials, models overestimated GOES no-load
the analysis, DOE has limited its costs, and designs. (Efficiency losses, and accordingly assumed
selection in the base case scenario as Advocates, No. 52 at p. 7) Eaton manufacturers would need lower load
described in section IV.F.3.a to be commented that the average selling losses in order to meet efficiency
reflective of its current market share. In price in the plots comparing bid data standards.
the presence of higher standards, M2 and DOE engineering show average The process of converting electrical
steel (or similarly performing hib steel selling prices being much higher than steel from a sheet into a formed core
that wasn’t modeled but has similar DOE’s analysis suggests. (Eaton, No. 55 shape incurs some number of additional
performance may be an option), may be at p. 22) losses, known as a destruction factor.
a feasible design option for DOE is uncertain what significant Eaton commented that when comparing
manufacturers although, it may not be difference in MSP the stakeholders are amorphous laminations to a finished
the lowest first cost option. referring to as there is a wide range in core, the destruction factor can be non-
Regarding the burdens with using the bid data and many of the points trivial and contribute an additional 40
amorphous steel, DOE has considered overlap between the bid data and DOE percent to the core losses. (Eaton, No. 55
those costs in the manufacturer impact designs. Regardless, DOE has updated at p. 11) Similarly, in GOES cores, the
analysis in section IV.J of this material costs in the NOPR analysis. destruction factor can be significant and
document. In presenting the bid data, DOE noted varies by transformer type,
Eaton noted that while DOE’s designs that it only has full load efficiency at manufacturing technique, and electrical
span the current definition for normal rated operating temperature, and steel type. In general, destruction factors
impedance range, if new designs are run therefore applied a quadratic scaling are much more significant for three-
in the future, a narrower impedance and estimated temperature correction to phase distribution transformers than
range should be used for RU4 and RU5 estimate the efficiency as measured single-phase distribution transformers.
to align with IEEE C57.12.34, as too low according to DOE’s test procedure.49 The destruction factor for three-phase
an impedance could permit extremely Eaton commented that DOE’s estimate wound core designs was originally
high fault current in the event of a short for correcting the load loss in the bid chosen to be conservative and assume
circuit. (Eaton, No. 55 at p. 16) data is insufficient. (Eaton, No. 55 at p. manufacturers would have higher
As Eaton noted, DOE’s impedance 20) Eaton expressed concern that a destruction factors. Through interviews,
ranges align with the current definition similar method was used to calculate DOE learned that manufacturers may be
for normal impedance range. The DOE’s 50 percent load loss values from able to reduce destruction factors in
narrower impedance range cited by the 100 percent load loss values. (Eaton, wound cores using a Unicore design,
Eaton are achievable in DOE’s models No. 55 at p. 20) and this is more common in larger,
by all efficiency levels. DOE believes DOE did not use the same method to three-phase designs which tend to be
aligning with the definition of normal calculate 50 percent load loss values produced in lesser volumes. In the
impedance range remains appropriate from the 100 percent values in it NOPR analysis, DOE modified the
given that a variety of impedances are modeled data, it only did this in the bid destruction factor of three-phase, liquid-
included at each efficiency level and data because the bid data did not have immersed, wound core, GOES
consumers may specify specific specifics as to how the equipment distribution transformers to better align
impedances. temperature varies with load and with the marketed Unicore destruction
b. Data Validation temperature correction was simply to factors.50 The resulting designs better
estimate efficiency for a general align with the actual design space
In the August 2021 Preliminary
comparison. DOE’s modeled data observed in real world data, as shown
Analysis TSD, DOE stated that it had
included estimated load performance in chapter 5 of the TSD. The impact of

collected publicly available bid data for
and temperature at a variety of this change is that GOES transformers
a variety of distribution transformers.
transformer load points. DOE relied on achieve higher efficiency ratings for
DOE noted that the data was limited in
the modeled transformer load loss at 50 RU4 and RU5 than the August 2021
its ability to compare cost and efficiency
because the data was limited to liquid- 49 See Chapter 5 of the NOPR TSD, available 50 Advertised destruction factors for Unicore
immersed distribution transformers, online at www.regulations.gov/document/EERE- available at www.aemcores.com.au/technology/
there was significant variability in 2019-BT-STD-0018-0022. annealing/overview-and-the-benefit-of-unicore/.
Preliminary Analysis TSD suggested. It standards are met via a transition to distribution transformers with identical
also introduces new transformers to the lower-loss GOES or amorphous steel, characteristics because of difference in
selectable design space which may have the incremental cost to meet higher applications and manufacturer
a lower MSP than if DOE had not made efficiency standards tends to be similar. practices. The mechanics of the
this change. While destruction factor In bid data, DOE observed that higher customer choice model at baseline and
does vary by manufacturing technique current transformers, which are more higher efficiency levels are discussed in
and manufactures may use different likely to have high stray losses, often section IV.F.3 of this document.
methods, DOE believes that absent this have more amorphous bids. This
change, it would be overestimating the suggests that transformers with high d. Higher Efficiency Levels
cost of meeting efficiency standards buss losses may have more favorable DOE relies on a similar approach to
with a GOES core as compared to an economics associated with meeting its baseline engineering in evaluating
amorphous core. amended efficiency standards via higher efficiency levels. DOE’s modeled
Regarding DOE’s use of modeling amorphous steel. units span the design space. In
software, Powersmiths commented that Regarding validation of DOE’s evaluating a higher efficiency level up
OPS software is used by them and many engineering analysis more generally, until that maximum efficiency level that
manufacturers but noted that the eddy NEMA commented that its members
DOE considers (‘‘max-tech’’), DOE
and stray losses in OPS models are cannot validate and offer corrections for
evaluates the modeled units that would
‘‘guestimates’’ from the design engineer every RU but suggested DOE hold a
exceed the higher efficiency level. Then,
and can vary largely. (Powersmiths, No. series of collaborative meetings where
rather than selecting a single unit, DOE
46 at pp. 4–5) Powersmiths commented models are made more accurate and
applies a customer choice model to
that inadequate stray loss estimates representative. (NEMA, No. 50 at p. 2)
evaluate the distribution transformers
could result in simulation errors and Eaton requested DOE provide more
that would be purchased if standards
should be examined more closely information about the distribution
were amended.
relative to transformer capacity. transformer design so manufacturers can
(Powersmiths, No. 46 at p. 5) confirm the designs align with their Howard commented that they looked
NEMA commented that its members’ modeling. (Eaton, No. 55 at p. 20–22) at the various RUs and believe the
modeling programs account for stray, DOE has included additional current efficiency standards provide
eddy, and other losses that appear engineering details in chapter 5 of the excellent value to consumers. (Howard,
largely absent from DOE models and TSD to better explain its modeling and No. 59 at p. 2) Howard added that while
while this was noted in the April 2013 costing. Regarding NEMA’s suggestion they don’t use OPS software, their
Standards Final Rule, the efficiency to hold collaborative meetings, DOE internal software says to remain at the
levels in the preliminary analysis leave notes that in addition to soliciting current efficiency levels and there is no
little flexibility to meet efficiency public comment in a written format and need to have a NOPR as current
standards, making it more important public interviews, DOE conducts standards are sufficient. (Howard, No.
now. (NEMA, No. 50 at p. 2) NEMA confidential manufacturer interviews 59 at pp. 2–3) DOE appreciates
added by omitting these design factors, through which manufacturers are Howard’s comment but notes that they
DOE’s models do not represent true invited to offer feedback. DOE has in the have not provided data to justify the
design feasibility and DOE should past, and as part of this analysis, made results of their internal software. As
update models to add these losses. updates to its modeling to better reflect noted previously, DOE has tentatively
(NEMA, No. 50 at p. 2) NEMA manufacturer realities. DOE will determined that the proposed standards
commented specifically that in continue to update its analysis in are technologically feasible (based on
applications with a large amount of buss response to manufacturer feedback and models currently available in the
bars are required, efficiency standards particularly to the extent modeling market) and economically justified, and
are more difficult to meet. (NEMA, No. deviates from real world design would result in significant energy
50 at p. 5) constraints. savings.
DOE transformer models do include
c. Baseline Energy Use The Efficiency Advocates commented
estimates of stray and eddy losses. As
For each equipment class, DOE that since DOE last revised its energy
commenters noted, the amount that
generally selects a baseline model as a conservation standards, major
these impact designs will be unique to
reference point for each class, and economies around the world have set
manufacturer and specific transformer
measures changes resulting from new efficiency thresholds that exceed
designs. In DOE’s comparison of its
potential energy conservation standards U.S. energy conservation standards.
liquid immersed designs to the design
against the baseline. The baseline model (Efficiency Advocates, No. 52 at pp. 7–
space in public utility bid data, DOE
in each product/equipment class 8) The Efficiency Advocates commented
notes that its designs align relatively
represents the characteristics of a that the U.S. should aim to be a world
well with what is being built on the
product/equipment typical of that class leader in transformer efficiency.
market. Further, DOE includes a bus
(e.g., capacity, physical size). Generally, (Efficiency Advocates, No. 52 at pp. 7–
and lead correction factor to MVDT
a baseline model is one that just meets 8)
designs based on an understanding that
substation-style designs are quite current energy conservation standards, DOE notes that while it may look at
common in the MVDT market. or, if no standards are in place, the foreign efficiency standards to get a
DOE requests data as to how stray and baseline is typically the most common better understanding of the global
distribution transformer market, the
eddy losses at rated PUL vary with kVA or least efficient unit on the market.
and rated voltages. DOE’s analysis for distribution U.S. has its own unique economic
While certain unique designs may transformers generally relies on a conditions, energy costs, and legal
have higher stray and eddy losses, the baseline approach. However, instead of requirements. DOE has evaluated
incremental costs with meeting higher selecting a single unit for each amended energy conservation standards
efficiency standards tends to follow a efficiency level, DOE selects a set of based on the unique conditions of the
similar relationship. Particularly to the units to reflect that different distribution U.S. and DOE’s legal obligations under
extent that amended efficiency transformer purchasers may not choose EPCA.
e. Load Loss Scaling factor in its scaling model. (NEEA, No. • Catalog teardowns: In lieu of
DOE energy conservations standards 51 at p. 6) DOE notes that section 4.1 of physically deconstructing a product,
apply only at a single PUL for a given appendix A specifies testing using a DOE identifies each component using
distribution transformer equipment sinusoidal waveform. Therefore, parts diagrams (available from
class (50 percent for liquid-immersed harmonics would not impact the rated manufacturer websites or appliance
distribution transformers and medium efficiency of a distribution transformer. repair websites, for example) to develop
In DOE’s downstream analyses, the bill of materials for the product.
voltage dry-type distribution
harmonics would generally lead to • Price surveys: If neither a physical
transformers and 35 percent for low-
greater losses. While nonlinear loads nor catalog teardown is feasible (for
voltage dry-type distribution
exist, the impact of them is small and example, for tightly integrated products
transformers). 10 CFR 431.196.
DOE does not have data suggesting they such as fluorescent lamps, which are
However, distribution transformers infeasible to disassemble and for which
meaningfully impact system wide
exhibit varying efficiency with varying parts diagrams are unavailable) or cost-
savings to the point that a quadratic
PUL. Distribution transformer no-load prohibitive and otherwise impractical
approximation is inaccurate. Further,
losses are generally constant with (e.g., large commercial boilers), DOE
while harmonics may increase losses,
loading, while load losses vary conducts price surveys using publicly
relative to what a quadratic
approximately with the quadratic of the available pricing data published on
approximation would estimate, lower
PUL. In practice, efficiency deviates major online retailer websites and/or by
operating temperatures at low-loading,
slightly from this assumption as no-load soliciting prices from distributors and
where most distribution transformers
losses are not perfectly constant and other commercial channels.
operate, would decrease losses relative
load losses are not perfectly quadratic. In the present case, DOE conducted
to the quadratic approximation.
DOE requested comment on While other factors may cause the loss the analysis by applying materials
approximating load losses as a quadratic behavior of individual transformers in prices to the distribution transformer
function of PUL. specific applications to deviate slightly designs modeled by OPS. The resulting
NEMA commented that the quadratic from a true quadratic of the full-load bill of materials provides the basis for
approximation for load losses is losses, stakeholders have generally the manufacturer production cost
sufficient. (NEMA, No. 50 at p. 11) supported approximating load losses a (‘‘MPC’’) estimates to which mark-ups
OPS’ modeling includes details as to are applied to generate manufacturer
quadratic of PUL and have not provided
how a distribution transformer’s loss selling prices (‘‘MSP’’). The primary
an alternative, more accurate method for
and temperature vary across select load material costs in distribution
approximating losses. As such, DOE has
points. In determining the rated transformers come from electrical steel
retained a quadratic load loss scaling in
efficiency of a transformer model as it used for the core and the aluminum or
its analysis.
would be certified under DOE’s test copper conductor used for the primary
procedure, DOE relies on the modeled f. kVA Scaling and secondary winding. DOE presented
load losses at the PUL at which NEMA commented that the 0.75 preliminary costing data and
efficiency is calculated and corrects the power scaling rule is overly simplistic methodology in the August 2021
load losses from the modeled and has resulted in smaller kVA MVDTs Preliminary Analysis TSD.
temperature to the reference having a hard time meeting efficiency Regarding the cost analysis generally,
temperature. This value is used to standards. (NEMA, No. 50 at p. 9) Eaton NEMA commented that the material
calculate the rated efficiency of a commented that DOE’s scaling rule as it prices presented in the preliminary
distribution transformer model. applied to height, width, and depth of analysis do not reflect the post-COVID
In the downstream analysis of a the core/coil assembly would not world and may be low by as much as
distribution transformer energy use and always be accurate due to certain half. (NEMA, No. 50 at p. 2) Eaton
costs, DOE relies on the calculated full- bushing space requirements and design commented that PPI for power and
load loss values and applies a quadratic trade-offs pertaining to bushing heights distribution transformers has increased
approximation for what the load losses relative to core/coil assembly heights. around 25 percent from 2020 levels and
would be under real world loading (Eaton, No. 55 at p. 16) so costs are going to be higher and
conditions. Commenters have generally DOE has not received any comment or payback periods will be longer. (Eaton,
agreed that this approach is sufficient. data suggesting an alternative method No. 55 at p. 13) Howard echoed the
DOE noted that the full-load loss for scaling kVA and therefore has concerns that Covid–19 has created
value DOE uses in its downstream retained its scaling methods. labor and supply chain issues. (Howard,
analysis is the full-load loss estimate at No. 59 at p. 1) Howard commented that
the modeled transformer temperature. 3. Cost Analysis their internal studies showed
Full-load loss in industry is often The cost analysis portion of the incremental MSPs as much as four times
reported at the rated temperature rise. engineering analysis is conducted using higher than what DOE showed in their
Lower loss distribution transformers one or a combination of cost preliminary analysis. (Howard, No. 59 at
generally operate at lower temperatures, approaches. The selection of cost p. 2) Carte commented that the cost of
as they have less losses of heat to approach depends on a suite of factors, both copper and aluminum have risen
dissipate. Some transformers may including the availability and reliability substantially in the past year. (Carte, No.
operate well below their rated of public information, characteristics of 54 at pp. 3–4) Powermiths added that
temperature even at full load. Therefore, the regulated product, the availability market megatrends, such as the
the full-load losses used in the pandemic, decarbonization and electric
and timeliness of purchasing the

downstream analysis may be lower than equipment on the market. The cost vehicles may impact the analysis and
the reported full-load losses at rated approaches are summarized as follows: create uncertainty. Powesmiths
temperature rise. • Physical teardowns: Under this recommended DOE delay changes until
NEEA commented that a quadratic approach, DOE physically dismantles a these megatrends settle. (Powersmiths,
scaling of load losses would not apply commercially available product, No. 46 at pp. 6–7) Powersmiths and
with harmonic frequencies and DOE component-by-component, to develop a Carte commented that the market is in
should include a harmonic dependent detailed bill of materials for the product. a state of flux right now and it may be
prudent to hold off any changes to increased as much as 61 percent and (Carte, No. 54 at p. 3) DOE notes that
efficiency standards until prices settle. they do not see them returning to their amorphous steel is produced
(Carte, No. 54 at p. 4; Powersmiths, No. lower prices. (Powersmiths, No. 46 at p. domestically, as well as in China and
46 at p. 7) 6) Japan.
DOE data confirms that prices have Carte commented that there is a global NEEA commented that its research
been up recently, however, it is difficult shortage of electrical steel and the price suggests amorphous cores are lower first
to say for certain how those prices will is up 20 percent in this year alone, with cost above 100 kVA single-phase or 500
vary in the medium to long terms and current prices up 76 percent from the kVA three-phase and there are several
what those prices will be in the future. 2008 peak. (Carte, No. 54 at p. 3) Carte utilities commonly purchasing
Rather than trying to project future noted that some industry sources expect amorphous in the U.S. and Canada.
prices, DOE relies on a five-year average prices to far exceed their 2008 peaks. (NEEA, No. 51 at p. 8) Metglas
in its base case and evaluates how the (Carte, No 54 at p. 3) commented that its internal calculations
results would change with different Carte cited several reasons for the show that amorphous steel is not close
pricing sensitivities. The recent price increase in pricing. China has reduced to price parity with GOES, using DOE’s
increases described by comments are export of GOES in recent years. (Carte, preliminary analysis assumed pricing.
incorporated into this five-year average No. 54 at p. 3) Second, increased (Metglas, No. 53 at p. 2) Metglas
and as a result, prices in the NOPR competition from non-oriented commented that recent bid data shows
analysis are higher than they were in the electrical steel serving the electric amorphous transformers typically need
August 2021 Preliminary Analysis TSD. vehicle industry which has encouraged an A value over $7 per Watt and A to
Eaton commented that in evaluating some steel manufacturers to convert B ratio greater than $3 per Watt for
amended energy conservation GOES production lines to non-oriented amorphous transformers to win on total
standards, DOE should solicit electrical steel production lines. (Carte, ownership cost bids. (Metglas, No. 53 at
quotations from at least three No. 54 at p. 3) p. 2) Metglas commented that DOE’s
distribution transformer manufacturers DOE has updated pricing in this preliminary analysis pricing of
for each representative unit and create analysis in response to stakeholder amorphous is accurate for sourced
a cost-down cost estimate to calibrate feedback and confidential manufacturer cores, but may be lesser for
the bottom-up estimates. (Eaton, No. 55 interviews. Prices for electrical steel manufacturers who produce their own
at p. 19) have increased significantly in recent cores. (Metglas, No. 53 at p. 5)
As DOE noted in section IV.C.2.b, years. Manufacturers noted that this Metglas commented that some
DOE welcomes manufacturers to submit price increase was particularly high for transformer manufacturers source cores
design and costing data for distribution foreign electrical steel. DOE has applied while other produce them internally.
transformers. DOE notes that in addition a 5-year average price in its base case (Metglas, No. 53 at p. 5) NEMA
to soliciting public comment in a analysis. The prices in and conducted disagreed with DOE’s assumption that
written format and public interviews, sensitivities for various other pricing all amorphous cores are sourced and
DOE conducts confidential scenarios, as discussed in section deferred to individual NEMA members
manufacturer interviews through which IV.C.3. as to their specific practices. (NEMA,
much of the pricing data is gathered. EEI commented that higher standards No. 50 at p. 11)
DOE has made some updates to its cost may significantly impact all non- Pricing for amorphous steel has
analysis in response to manufacturer amorphous cores and limit choice and increased slightly since the preliminary
feedback, as described in the following lead to higher prices for consumers analysis but less so than GOES steel,
sections. considering limited availability of and in particular foreign produced
certain steel. (EEI, No. 56 at p. 3) GOES. As such, amorphous steel is
a. Electrical Steel Prices DOE generally assumes pricing to be generally more competitive on first cost
Electrical steel is one of the primary reflective of current market costs. While than it was in the preliminary analysis.
drivers of efficiency improvements and higher standards could limit which As NEEA suggested, DOE did observe
the relative costs associated with steels are available to meet standards, instances where amorphous
transitioning to lower loss steels can DOE notes that a handful of high- transformers are lower first cost.
impact the cost effectiveness of volume steels currently dominate the However, that has not necessarily led to
amended efficiency standards. As noted, industry. Historically, when amended increased adoption, in part because
in section IV.A.5, the sourcing practices standards have been adopted, steel most manufacturers’ capital equipment
of individual manufacturers and manufacturers have increased capacity is set-up for GOES core production.
production locations can impact prices of the electrical steel grades needed to Amorphous transformer production
as not all steel manufacturers produce meet amended efficiency standards. would require manufacturer investment
the same electrical steels and trade These materials may have higher costs, to fill high volume orders. As such, the
actions have historically impacted the but they also tend to have higher costs first cost competitiveness of amorphous
industry. DOE presented pricing in the in the current market. Rather than trying steel in certain applications has not
August 2021 Preliminary Analysis TSD to predict what the cost and market necessarily corresponded to equivalent
and requested comment. (August 2021 breakdown would be in the presence of market share. DOE has continued to
Preliminary Analysis TSD at p. 2–53) amended standards, DOE relies on a assume sourced core pricing for
ERMCO commented that the core five-year average and conducts price amorphous steel as most manufacturers
steel costs presented in the preliminary sensitivities to ensure that energy do not have the capacity to produce
analysis seem reasonable, but market cores in volume. While Metglas notes
savings are cost effective under different

growth in sectors, like EVs, may drive pricing structures. that manufacturers producing their own
future prices up. (ERMCO, No. 45 at p. Carte commented that while they cores could have lesser costs, DOE notes
1) Powersmiths commented that smaller don’t purchase amorphous steel, DOE in that scenario they would likely have
manufacturers cannot access the DOE may want to verify that amorphous steel additional retooling costs that would be
costs because volume drives price. from China is still available and aggregated over unit volume and
Powersmiths noted that for one of the questioned if there were any domestic increase core price relative to raw
pdr steels it uses, the price has manufacturers of amorphous steel. materials. More details regarding DOE’s
pricing of amorphous steel are included During this time, China added supply chain disruptions caused by the
in chapter 5 of the TSD. significant domestic electrical steel Covid–19 pandemic, many of the price
For this NOPR, DOE’s analysis shows production capacity, such that from effects that, directly or indirectly,
that it is cost-effective to meet the 2016 to 2019 only about 22,000 tonnes impact the pricing of distribution
proposed standards for liquid-immersed were imported to China annually. China transformers may still be stabilizing.
and low-voltage dry-type distribution also exported nearly 200,000 tonnes of Another recent trend in distribution
transformers fabricated with amorphous electric steel annually by the late 2010’s. transformer manufacturing is an
steel cores. An energy conservation Many of the exporters formerly increase in rate of import or purchase of
standard that significantly increases serving China sought new markets finished core products. The impact of
adoption of amorphous core distribution around 2011, namely the United States. electrical steel tariffs on manufacturers’
transformers would represent a The rise in U.S. imports at this time hurt costs varies widely depending on if
substantial shift in the distribution domestic U.S. steel manufacturers, such manufacturers are purchasing raw
transformer market. Such a shift could that in 2013, domestic U.S. steel electrical steel and paying a 25-percent
impact pricing and competition among stakeholders filed anti-dumping and tariff if the steel is imported, or if they
steel suppliers in ways that may not be countervailing duty petitions with the are importing finished transformer cores
perfectly predictable, as the resulting U.S. International Trade Commission.53 which, along with distribution
market equilibrium would depend on The resulting investigation found that transformer core laminations and
decisions made by market participants ‘‘an industry in the United States is finished transformer imports, are not
outside of DOE’s control. However, it is neither materially injured nor subject to the tariffs. Some stakeholders
important to emphasize that price threatened with material injury by have argued that this trend toward
volatility in electrical steel and shifts in reason of imports of grain-oriented importing distribution transformer
the market’s competitive balance are not electrical steel . . . to be sold in the cores, primarily from Mexico and
limited to amorphous steel. United States at less than fair value.’’ 54 Canada, is a method of circumventing
Substantial volatility has In the amorphous steel market, the tariffs, as electrical steel sold in the
characterized the U.S. steel market over necessary manufacturing technology has global market has been less expensive
the last several decades. From 2000 to existed for many decades and has been than domestic electrical steel on
2007, U.S. steel markets, and more used in distribution transformers since account of being unfairly traded.59 60
specifically the U.S. electrical steel the late 1980s.55 In many countries, Conversely, other stakeholders have
market, began to experience pressure amorphous steel is widely used in the commented that this trend predated the
from several directions. Demand in cores of distribution transformers.56 electrical steel tariffs and that
China and India for high-efficiency, Significant amorphous steel use tends to importation of transformer components
grain-oriented core steel contributed to occur (1) in places with both is often necessary to remain competitive
increased prices and reduced global comparatively lower labor costs and in the U.S. market, given the limited
availability. Cost-cutting measures and significant electrification (e.g., India, number of domestic manufacturers that
technical innovation at their respective China); and (2) in regions with relatively produce transformer laminations and
facilities, combined with the lower high loss valuations on losses (e.g., cores.61 62
value of the U.S. dollar enabled certain provinces of Canada). On May 19, 2020, the U.S.
domestic core steel suppliers to become Beginning in 2018, the U.S. Department of Commerce (DOC) opened
globally competitive exporters. government instituted a series of import an investigation into the potential
In late 2007, the U.S. steel market duties on aluminum and steel articles, circumvention of tariffs via imports of
began to decline with the onset of the among other items. Steel and aluminum finished distribution transformer cores
global economic crisis. U.S. steel articles were generally subject to and laminations. 85 FR 29926. On
manufacturing declined to nearly 50 respective import duties of 25 and 10 November 18, 2021, DOC published a
percent of production capacity percent ad valorem.57 83 FR 11619; 83 summary of the results of their
utilization in 2009 from almost 90 FR 11625. Since March 2018, several investigation in a notice to the Federal
percent in 2008. Only in China and presidential proclamations have created Register. The report stated that
India did the production and use of or modified steel and aluminum tariffs, importation of both GOES laminations
electrical grade steel increase for 2009.51 including changes to the products and finished wound and stacked cores
In 2010, the price of steel began to covered, countries subject to the tariffs, has significantly increased in recent
recover. However, the recovery was exclusions, etc.58 Given the recency of years, with importation of laminations
driven more by increasing cost of several publications, combined with the increasing from $15 million in 2015 to
material inputs, such as iron ore and $33 million in 2019, and importation of
coking coal, than broad demand 53 U.S. International Trade Commission, Grain- finished cores increasing from $22
recovery. Oriented Electrical Steel from Germany, Japan, and million in 2015 to $167 million in 2019.
Poland, Investigation Nos. 731–TA–1233, 1234, and DOC attributed these increases, at least
In 2011, core steel prices again fell 1236. September 2014.
considerably. At this time, China began 54 Id.
in part, to the increased electrical steel
to transition from a net electrical steel 55 DeCristofaro, N., Amorphous Metals in Electric- costs resulting from the imposed tariffs
importer to a net electrical steel Power Distribution Applications, Material Research on electrical steel. In response to their
exporter.52 Between 2005 and 2011, Society, MRS Bulletin, Volume 23, Number 5, 1998. investigation, DOC stated it is exploring
56 BPA’s Emerging Technologies Initiative, Phase
China imported an estimated 253,000 to several options to shift the market
1 report: High Efficiency Distribution Transformer
353,000 tonnes of electrical steel. Technology Assessment, April 2020. Available
towards domestic production and
online at: https://www.bpa.gov/EE/NewsEvents/

59 (AK Steel, Docket No. BIS–2020–0015–0075 at
51 International Trade Administration. Global presentations/Documents/
Steel Report. (Last accessed September 1, 2022) Transformer%20webinar%204-7-20%20Final.pdf. pp. 43–58).
60 (American Iron and Steel Institute, Docket No.
https://legacy.trade.gov/steel/pdfs/global-monitor- 57 Ad valorem tariffs are assessed in proportion to
report-2018.pdf. an item’s monetary value. BIS–2020–0015–0033 at pp. 2–5).

52 Capital Trade Incorporated, Effective Trade 58 Congressional Research Service, Section 232 61 (Central Maloney Inc., Docket No. BIS–2020–
Relief on Transformer Cores and Laminations, Investigations: Overview and Issues for Congress, 0015–0015 at pp. 1).
2020. Submitted as part of AK Steel comment at May 18, 2021, Available online at: https://fas.org/ 62 (NEMA, Docket No. BIS–2020–0015–0034 at
Docket No. BIS–2020–0015–0075 at p. 168. sgp/crs/misc/R45249.pdf. pp. 3–4).
consumption of GOES, including examples with which manufacturers regarding how changes in production
extending tariffs to include laminations have been able to quickly add volume affect material prices, DOE
and finished cores. No trade action has amorphous capacity, along with the relies on a 5-year average pricing for its
been taken at the time of publication of cited number of producers capable of core steel.
this NOPR. 86 FR 64606. making amorphous steel, DOE’s view is DOE requests comment on the current
More recently, DOE learned from that it is reasonable to expect that if and future market pressures influencing
stakeholders during manufacturer there were insufficient amorphous steel the price of GOES. Specifically, DOE is
interviews and from public comments production capacity to meet amended interested in the barriers to and costs
that pricing of electrical steel has risen energy conservation standards, some associated with converting a factory
such that in the current market, it is manufacturers with the expertise to production line from GOES to NOES.
similar between domestic and foreign produce amorphous steel would enter DOE further requests comment
electrical steel (i.e., the price of foreign the market and manufacturers currently regarding how the prices of both GOES
electrical steel without any tariffs without the expertise to manufacture and amorphous are expected to change
applied). (Powersmiths, No. 46 at p. 6; amorphous steel may invest in its in the immediate and distant future.
Carte, No. 54 at p. 3) These recent price development. DOE requests comment regarding the
increases, particularly in foreign Additionally, during manufacturer barriers to converting current M3 or
produced electrical steel, were cited as interviews, stakeholders indicated that 23hib90 electrical steel production to
being a result of both general supply in the current marketplace there are lower-loss GOES core steels.
chain complications and increased shortages of GOES steel products, DOE requests comment as to if there
demand for non-oriented electrical steel leading to greater price levels and are markets for amorphous ribbon,
(NOES) from electric motor volatility. Because GOES production similar to NOES competition from
applications. (NEMA, No. 50 at p. 9; can be shifted to NOES products at GOES production, which would put
Powersmiths, No. 46 at p. 5; Zarnowski, modest cost, these shortages are likely competitive pressures on the production
Public Meeting Transcript, No. 40 at p. driven at least in part by rising demands of amorphous ribbon for distribution
36; Looby, Public Meeting Transcript, for NOES in manufacture of motors and transformers.
No. 40 at p. 37) electric vehicles. This demand creates DOE requests comment on how a
Since 2016, there has been one competition for GOES production potentially limited supply of
domestic supplier and multiple global capacity. Given recent trends of transformer core steel, both of
suppliers of GOES. The amorphous steel decarbonization initiatives and amorphous and GOES, may affect core
market follows the same pattern, with industrial reshoring, the manufacture of steel price and availability. DOE seeks
one domestic supplier and multiple NOES for electric vehicle production comment on any factors which uniquely
global suppliers. Further, although the appears poised to put competitive affect specific steel grades (e.g.,
current foreign suppliers of amorphous pressure on GOES production well into amorphous, M-grades, hib, dr, pdr).
steel are primarily based in Japan and the future.65 Additionally, DOE seeks comment on
China, DOE received feedback through Further, there has been, and remains, how it should model a potentially
public comment and manufacturer competition for available low-loss concentrated domestic steel market in
interviews that South Korean and grades of GOES between the power and its analysis, resulting from a limited
German steel suppliers have the distribution transformer segments. Cliffs number of suppliers for the amorphous
capabilities to expand their steel commented that while high- market or from competition with NOES
production to include amorphous steel, permeability GOES works well in for the GOES market, including any use
if demand for amorphous steel distribution transformers, it has of game theoretic modeling as
increases. (Metglas, No. 11 at p. 2) DOE historically been sold as a laser DR appropriate.
does not have data suggesting that product to the power transformer
market; NEMA commented that both b. Scrap Factor
amorphous steel is inherently more
expensive to produce than GOES. Both distribution and power transformers In the August 2021 Preliminary
varieties rely on similar inputs and both compete for steel demand. (Cliffs, No. Analysis TSD, DOE noted that it applies
are capital-intensive, therefore tending 57 at p. 1; NEMA, No. 50 at p. 9) various scrap markups to distribution
to reduce per-pound production costs Therefore, it is likely that any energy transformer bills of materials (August
with higher capacity utilizations. savings associated with use of lower- 2021 Preliminary Analysis TSD at p. 2–
Public comments by Metglas stated loss core steel, whether it be amorphous 53). DOE requested comment on its
that within two years of developing the or grain-oriented, would require scrap factor markups. Metglas
know-how to produce amorphous investment from steel manufacturing commented that DOE should not apply
ribbon, producers in China were able to industry at-large to increase capacity of a scrap to a finished core because the
add 70,000 Mt of capacity.63 Public either lower-loss GOES steels or of scrap would be included in the core
statements from one manufacturer in amorphous steel. costs. (Metglas, No. 53 at p. 5)
Europe note that since the expiration of Rather than constructing sensitivity DOE notes that a scrap factor is still
an initial patent related to amorphous analysis scenarios to reflect every applied to prefabricated cores to
steel production, there have been a potential combination of factors that account for any potential breakage of
number of additional amorphous may affect steel pricing (e.g., various cores and any scrap associated with
suppliers and material prices have been tariffs and quotas, competition from assembling the windings or insulation
stable.64 Given these historical NOES, decisions by steelmakers in on the cores. However, a lesser factor is
various countries to add production
used as compared to GOES because

63 Metglas, Section 232 National Security capacity) or making assumptions much of the scrap costs would be priced
Investigation of Imports of Steel: Comments by into the core production.
Metglas, Inc. Requesting the Inclusion of www.wilsonpowersolutions.co.uk/app/uploads/ Metglas commented that the scrap
Amorphous Steel, 2017. https://www.bis.doc.gov/ 2017/05/WPS_AMT_Myth_Buster_2018-2.pdf. rate for GOES seemed low but did not
index.php/232-steel-public-comments/1835- 65 Example: California’s electric vehicle adoption
metglas-amorphous-public-comment. executive order: https://www.gov.ca.gov/wp-
provide an alternative value. (Metglas,
64 Wilson Power Solutions, Amorphous Metal content/uploads/2020/09/9.23.20-EO-N-79-20- No. 53 at p. 5) Eaton commented that it
Transformers—Myth Buster, 2018. https:// Climate.pdf, 2022. is unclear which mark-ups are applied
to which cores and DOE should clarify. calculations but cabinet/enclosures are unit and noted many specific areas in
(Eaton, No. 55 at p. 14) and DOE should add these into the the bottom-up approach that appeared
DOE has maintained the scrap factors analysis. (NEMA, No. 50 at p. 14) to underestimate labor. (Eaton, No. 55 at
from the preliminary analysis as it did DOE has modeled a cabinet and p. 17–19) Eaton also noted that DOE
not receive alternative values and has enclosure in its sizing of distribution overestimated the RU5 additional
updated the language in chapter 5 of the transformer tanks. DOE has presented number of labor hours for building an
TSD to better explain how scrap factors these additional details in chapter 5 of amorphous distribution transformer and
were applied. DOE has added equations the TSD. that the only difference would be that
in chapter 5 to walk through how the an amorphous transformer would have
material costs were translated to MSPs. d. Cost Mark-Ups a split core assembly, which would
c. Other Material Costs Factory Overhead require above 1 hour of additional labor.
In the August 2021 Preliminary (Eaton, No. 55 at p. 20)
In the August 2021 Preliminary In manufacturer interviews, DOE
Analysis TSD, DOE presented material Analysis TSD, DOE noted that it used a
received concurring feedback that while
prices and requested comment on a factory overhead markup to account for
its estimates of labor per unit and
variety of additional materials used in all indirect costs associated with
bottoms-up approach were
distribution transformer construction. production, indirect materials and
approximately accurate for its single-
(August 2021 Preliminary Analysis TSD energy used, taxes, and insurance.
phase, liquid-immersed units, three-
at p. 2–50) (August 2021 Preliminary Analysis TSD phase units require substantially more
Eaton commented that while at p. 2–57) labor. DOE relied on manufacturer
windings combs and epoxy resin have Eaton commented that it was unclear interviews and confidential data to
materials cost listed, they are not used what exactly the factory overhead develop estimates for labor hours for
in liquid immersed transformers. (Eaton, markup was applied to, for example, did RU4 and RU5 that assumes a base labor
No. 55 at p. 14) DOE notes that it did it include only materials the consumer number of hours and a variable that
not apply either of those costs to liquid- produced themselves or did it apply to scales with unit size, similar to what is
immersed distribution transformers and purchased parts as well. (Eaton, No. 55 done for the dry-type distribution
has made that more clear in the NOPR at p. 15) transformers. These equations are
TSD. DOE applied the factory overhead presented in chapter 5 of the TSD.
Eaton commented that mineral oil and markup to all material costs, which Eaton commented that it believes the
mild steel prices are higher than was would include purchased parts. DOE fully burdened cost of labor is way too
shown in the August 2021 Preliminary understands that purchased parts would low and a value of $200/hour or more
Analysis TSD. (Eaton, No. 55 at p. 14) still require factory space, certain seems more appropriate. (Eaton, No. 55
Eaton commented that DOE may be equipment usage, taxes, and insurance. at p. 16)
underestimating pricing, in part due to DOE has added detail in chapter 5 of the DOE applies a labor cost per hour that
underestimating the number and costs TSD as to how it applied the Factory is generally derived from the U.S.
of some of the fixed components, such Overhead Mark-up. Bureau of Labor Statistic rates for North
as the number of bushings for RU4 and Labor American Industry Classification
RU5. (Eaton, No. 55 at pp. 14–16) DOE System (‘‘NAICS’’) Code 335311—
has made modifications to the pricing of Labor costs are an important aspect of ‘‘Power, Distribution, and Specialty
its fixed components and updated costs the cost of manufacturing a distribution Transformer Manufacturing’’ production
to reflect generally price changes in the transformer. In the August 2021 employee hourly rates and applied
underlying commodities. DOE notes Preliminary Analysis TSD, DOE mark-ups for indirect production,
that the fixed-costs generally do not described how the number of labor overhead, fringe, assembly labor up-
vary with efficiency and as such, higher hours were derived for each distribution time, and a nonproduction mark-up to
pricing of these fixed-components transformer design. For liquid-immersed get a fully burdened cost of labor. In the
would not impact the pay-back periods distribution transformers, DOE generally preliminary analysis, DOE adjusted the
for more efficient distribution relied on a bottoms-up approach, labor rate upward in response to
transformers. estimating the various hours associated manufacturer feedback. While some
Specifically, regarding the cost of the with the various steps in distribution manufacturers may have different labor
distribution transformer tank, Eaton transformer manufacturing. For dry-type costs, DOE generally considers the BLS
commented that the cost is too low and distribution transformers, DOE relies on statistics approximately representative.
appears to have omitted the cost of the a top-down approach to estimate the DOE has adjusted labor costs from the
cabinet and associated labor. (Eaton, No. total labor for a unit using equations preliminary analysis based on the ratio
55 at p. 15) derived from manufacturer data. These of increased labor costs in NAICS code.
Part of the difference in tank costs equations include a base labor charge
cited by Eaton, is likely associated with for a given unit and a variable charge Shipping
the increase in tank steel that has that varies with transformer size. DOE In the August 2021 Preliminary
occurred between when the preliminary notes in the August 2021 Preliminary Analysis TSD, DOE noted that it used a
analysis prices were gathered compared Analysis TSD, it mistakenly outlined a price per pound estimate to estimate the
to the NOPR prices. DOE has updated bottom-up approach for LVDTs when in shipping cost of distribution
tank steel prices, which has increased fact a top-down labor estimate was used. transformers. DOE stated that while
This discussion is modified in chapter shipping costs will vary depending on
the price of the distribution transformer

tank. DOE notes that weld time would 5 of the TSD, while the estimated labor several factors, including weight,
generally be included in calculation of per unit is unchanged. volume, footprint, order size,
labor. DOE has added additional detail In response to the August 2021 destination, distance, and other, general
as to calculation of tank cost in chapter Preliminary Analysis TSD, Eaton noted shipping costs (fuel prices, driver
5 of the TSD. that the estimates of labor hours for RU4 wages, demand, etc.), the price-per-
NEMA commented that radiators are and RU5 appeared to notably pound estimate is an appropriate
not always included in footprint underestimate the required labor per approximation of shipping costs and
reflects that there would be increased noted higher or lower gross margins, engineering analysis. (Efficiency
shipping costs associated with larger depending on the product class, there Advocates, No. 52 at p. 7)
distribution transformers. DOE then was generally agreement that the 20 DOE has acknowledged that aside
applied a non-production markup on percent gross margin was appropriate from lowest first cost, manufacturers
top of its shipping costs. DOE requested for the industry. As such, DOE has may be limited in their steel choice
comment on its methodology and the retained the 20 percent gross margin as under the base case. In certain cases, the
shipping costs used in the preliminary part of the NOPR analysis. incremental cost to higher efficiency
analysis. (August 2021 Preliminary standards may be low but assumes
Analysis TSD at p. 2–56) 4. Cost-Efficiency Results
access to suppliers of better performing
Howard commented that they have The results of the engineering analysis steel. DOE has updated its baseline
their own shipping division and trucks are reported as cost-efficiency data (or analysis to reflect the steel choices that
and optimize shipments to be most ‘‘curves’’) in the form of energy are currently made in the industry as
efficient. (Howard, No. 59 at p. 3) Eaton efficiency (in percentage) versus MSP described in section IV.F.3.a.
commented that shipping costs vary but (in dollars), which form the basis for
on average, DOE’s shipping cost subsequent analyses in the preliminary D. Markups Analysis
estimates are reasonable. (Eaton, No. 55 analysis. DOE developed sixteen curves The markups analysis develops
at p. 16) representing the sixteen representative appropriate markups (e.g., retailer
DOE did not receive any comment or units. DOE implemented design options markups, distributor markups,
data suggesting an alternative approach by analyzing a variety of core steel contractor markups) in the distribution
to shipping costs, therefore DOE has material, winding material and core chain and sales taxes to convert the
retained its price-per-pound mark-up to construction method for each MSP estimates derived in the
account for shipping in the NOPR representative unit and applying engineering analysis to consumer prices,
analysis. manufacturer selling prices to the which are then used in the LCC and PBP
Manufacturer Markup output of the model for each design analysis. At each step in the distribution
option combination. See TSD chapter 5 channel, companies mark up the price
To account for the manufacturer’s
for additional detail on the engineering of the product to cover costs. DOE’s
nonproduction costs and profit margin,
analysis. markup analysis assumes that the MSPs
DOE applies a manufacturer markup to
the MPC. The resulting MSP is the price Powersmiths commented that the estimated in the engineering analysis
at which the manufacturer distributes a cost-efficiency plots show it is too cheap (see section IV.C of this document) are
unit into commerce. In the preliminary to achieve higher efficiency and if it occurring in a competitive distribution
analysis, DOE applied a gross margin were really that cheap, the market transformer market as discussed in
percentage of 20 percent for all would move there without legislation. section V.B.2.d of this document.
distribution transformers.66 (Powersmiths, No. 46 at p. 5) For distribution transformers, the
Eaton commented that its gross profit Conversely, Metglas commented that the main parties in the distribution chain
margin was higher and a 20 percent market does not evaluate based on differ depending on the type of
gross margin is too low for a publicly efficiency and the only way to see distribution transformer being
traded corporation with obligations to efficiency improvements is via amended purchased and by whom.
stakeholders.67 (Eaton, No. 55 at p. 16– energy conservation standards. (Metglas, Liquid-immersed distribution
17) No. 53 at p. 8) transformers are almost exclusively
DOE’s average gross margin was In general, DOE’s analysis assumes purchased and installed by electrical
developed by examining the annual most distribution transformer customers distribution companies, as such the
Securities and Exchange Commission purchase based on lowest first cost and distribution chained assumed by DOE
(SEC) 10–K reports filed by publicly- there is limited market above minimum reflect the different parties involved.
traded manufacturers primarily engaged efficiency standards (see section Dry-type distribution transformers are
in distribution transformer IV.F.3.c). Therefore, DOE does not have used to step down voltages from
manufacturing and whose combined data to support manufacturers will build primary service into the building to
product range includes distribution above minimum efficiency standards, voltages used by different circuits
transformers. aside from certain select applications, within a building, such as, plug loads,
While some corporations may have even if it were only modestly more lighting, and specialty equipment; as
higher gross margins, the gross margin expensive. such DOE modelled that dry-type
is unchanged from the April 2013 The Efficiency Advocates commented distribution transformers are purchased
Standards Final Rule and was presented that the percentage of transformers core by non-residential customers, i.e.,
to manufacturers in confidential steels purchased in the preliminary commercial, and industrial customers.
interviews as part of both the analysis shows that too few GOES DOE considered the following
preliminary analysis and the NOPR transformers are being selected, distribution channel shown in Table
analysis. While some manufacturers indicating a potential issue in the IV.5.
TABLE IV.5—DISTRIBUTION CHANNELS FOR DISTRIBUTION TRANSFORMERS

Market share
Type Consumer Distribution channel
(%)
Liquid-Immersed Investor-owned utility ..................... 82 Manufacturer → Consumer.

18 Manufacturer → Distributor → Consumer.
Publicly-owned utility ...................... 100 Manufacturer → Distributor → Consumer.
LVDT .................. All ................................................... 100 Manufacturer → Distributor → Electrical contractor→ Consumer.
66 The gross margin percentage of 20 percent is 67 A 20 percent gross margin is equivalent to a
based on a manufacturer markup of 1.25. 1.25 manufacturer markup.
TABLE IV.5—DISTRIBUTION CHANNELS FOR DISTRIBUTION TRANSFORMERS—Continued

Market share
Type Consumer Distribution channel
(%)
MVDT ................. All ................................................... 100 Manufacturer → Distributor → Electrical contractor→ Consumer.
Howard commented that in in their immersed distribution transformers; transformer capacity (kVA) per home
experience that liquid-immersed commercial/industrial entities use depends on the number of homes
distribution transformers are sold mainly dry type), DOE performed two connected to the transformer. For
directly (more than 80%) to the utilities separate end-use load analyses to example, GEUS will place a 15 kVA
through our agents or manufacturing evaluate distribution transformer transformer for a single 1200 square foot
representatives. (Howard, No. 59 at p. 2) efficiency. The analysis for liquid- home, but 8 of these homes can be
DOE notes that the distribution immersed distribution transformers served by a single 50 kVA transformer.
channels used in the preliminary assumes that these are owned by GEUS further commented that to
analysis include a large fraction of sales utilities and uses hourly load and price balance transformer core (no-load)
as being direct to purchases by utilities data to estimate the energy, peak losses and resistive (load) losses their
that would encompass the demand, and cost impacts of improved design strategy is to serve as many
circumstances described by Howard, as efficiency. For dry-type distribution homes as possible within a 300 feet
shown in Table IV.5.68 For this analysis transformers, the analysis assumes that radius of the transformer. This design
DOE maintained the distribution these are owned by commercial and reduces transformer core (no-load)
channels distribution channels industrial (‘‘C&I’’) entities, so the energy losses by reducing the transformer kVA/
described in its preliminary analysis. and cost savings estimates are based on home, thereby reducing the ratio of no-
Chapter 6 of the NOPR TSD provides monthly building-level demand and load to load losses on each transformer.
details on DOE’s development of energy consumption data and marginal (GEUS, No. 58 at p. 1) Howard
markups for distribution transformers. electricity prices. In both cases, the commented that it is their
energy and cost savings are estimated understanding that in some rural areas,
E. Energy Use Analysis for individual distribution transformers there are transformers that are very
The energy use analysis produces and aggregated to the national level lightly loaded, and in other areas, some
energy use estimates and end-use load using weights derived from transformer units are loaded much more than 50
shapes for distribution transformers. shipments data. percent (Howard, No. 59 at p. 3) NEMA
The energy use analysis estimates the commented that the in-situ PUL varies
1. Hourly Load Model
range of energy use of distribution widely from region to region and
transformers in the field (i.e., as they are For utilities, the cost of serving the customer to customer. (NEMA, No. 50 at
used by consumers) enabling evaluation next increment of load varies as a p. 12)
of energy savings from the operation of function of the current load on the The Advocates asserted that DOE’s
distribution transformer equipment at system. To appropriately estimate the estimation of PUL to be too high and
various efficiency levels, while the end- cost impacts of improved distribution that if DOE decides to maintain these
use load characterization allows transformer efficiency in the Life-cycle PUL inputs at their current values, the
evaluation of the impact on monthly Cost (LCC) analysis, it is therefore Department should provide a sensitivity
and peak demand for electricity. The important to capture the correlation analysis that enables commenters to
energy use analysis provides the basis between electric system loads and evaluate the effect of PUL assumptions
for other analyses DOE performed, operating costs and between individual on the overall energy savings and
particularly assessments of the energy distribution transformer loads and economic analysis. (Efficiency
savings and the savings in operating system loads. For this reason, DOE Advocates, No. 52 at p. 6) Additionally,
costs that could result from adoption of estimated hourly loads on individual they commented that they believe DOE
amended or new standards. liquid-immersed distribution may be overestimating initial PUL (sic)
As presented in section IV.C transformers using a statistical model in the preliminary analysis; this may
transformers losses can be categorized that simulates two relationships: (1) the negatively affect higher EL designs that
as ‘‘no-load’’ or ‘‘load.’’ No-load losses relationship between system load and prioritize core loss reductions and they
are roughly constant with the load on system marginal price; and (2) the urged DOE to update its assumptions
the transformer and exist whenever the relationship between the distribution based on recently available data.
distribution transformer is energized transformer load and system load. Both (Efficiency Advocates, No. 52 at pp. 2,
(i.e., connected to electrical power). are estimated at a regional level. 5)
Distribution transformer loading is an Metglas commented that it is not
Load losses, by contrast, are zero at
important factor in determining which possible to derive transformer PUL just
when the transformer is unloaded, but
types of distribution transformer designs from the meter data. To get a
grow quadratically with load on the
will deliver a specified efficiency, and transformer’s PUL, one must associate
transformer.
for calculating distribution transformer which meters are getting supplied from
Because the application of
losses, and the time dependent values of which transformer. Further Metglas
distribution transformers varies
commented that, the data has come from
significantly by type of distribution those losses. To inform the hourly load

model DOE examined the data made only 127 zip codes adjacent to each
transformer (liquid-immersed or dry-
available through the IEEE Distribution other. Metglas asserted that the sample
type) and ownership (electric utilities
Transformer Subcommittee Task Force. is too small to draw conclusions at the
own approximately 95 percent of liquid-
National level, and suggested that DOE
a. Hourly Per-Unit Load (PUL) base their ruling on data submitted by
68 See:
Technical Support Document, chapter 2,
page 2–58. https://www.regulations.gov/document/ GEUS commented that because of Electric Utilities to the IEEE
EERE-2019-BT-STD-0018-0040. load diversity, individual distribution Transformer Committee which indicates
that the average PUL on transformers are observed in the field, DOE used a two- scaling factor selected from the
in the 0.1–0.2 values. (Metglas, No. 53 step approach. Transformer load data distribution of Initial Peak Loads (IPL),
at p. 7–8) were used to develop a set of joint and by the capacity of the representative
NEEA further noted that the per-unit probability distribution functions (JPDF) unit being modeled. In the August 2021
bases for both the system and individual which capture the relationship between preliminary analysis, DOE defined the
transformer loads in the joint histogram individual transformer loads and the IPL as a triangular distribution between
estimates are not related to the total system load.69 The transformer 50 and 130 percent of a transformer’s
transformer per-unit loads using loads were calculated as the sum load capacity with a mean of 85 percent. This
nameplate capacities as the basis. They of all connected meters on a given produces an hourly distribution of PUL
claim that this means that the loading transformer for each available hour of values from which hourly load losses
estimates obtained from the joint the year. Because the system load is the are determined. These distributions of
histograms cannot be directly applied to sum of the individual transformer loads, loads capture the variability of
the cited transformer loss formula, since the value of the system load in a given distribution transformers load diversity,
the latter assumes a per-unit loading on hour conditions the probability of the from very low to very high loads, that
a capacity basis. (NEEA, No. 51 at p. 2– transformer load taking on a particular are seen in the field.
3) value. To represent the full range of
system load conditions in the U.S., DOE In response to the comments from the
In this NOPR, DOE applied the same Advocates and Metglas, DOE revised the
approach it used in the August 2021 used FERC Form 714 70 data to compile
separate system load PDFs for each IPL assumptions in this NOPR to more
preliminary analysis where the hourly
census division. These system PDFs are closely align the resulting PUL with data
PUL is a function of both the
combined with a selected transformer made available through the IEEE
transformer’s simulated load and initial
JPDF to generate a simulated load Distribution Transformer Subcommittee
peak load (IPL). Where:
appropriate to that system. As the Task Force. The revised mean PULs for
PUL = simulated loadhourly × IPL. simulated transformer loads are scaled liquid-immersed representative unit
To capture the wide diversity in to a maximum of one, to calculate the used in this NOPR are shown in Table
distribution transformer loading that is losses, the load is multiplied by a IV.6.
TABLE IV.6—DISTRIBUTION OF PER-UNIT-LOAD FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS

Mean
Rep. unit simulated Mean IPL Mean PUL
hourly load
1 ................................................................................................................................................... 0.29 0.75 0.22

2 ................................................................................................................................................... 0.27 0.75 0.20
3 ................................................................................................................................................... 0.32 0.75 0.24
4 ................................................................................................................................................... 0.26 0.75 0.20
5 ................................................................................................................................................... 0.31 0.75 0.23
b. Joint Probability Distribution associated low probability leads to two, represented by the JPDF, is a
Function (JPDF) minimal impact on the energy loss conditional probability distribution.
calculations. The data will be reviewed DOE attempts to document its analyses
NEEA commented that when again to ensure that outliers have been in plain language, and the term
processing the load data into JPDF of removed. correlation was used simply to indicate
loads that observed hourly loads for NEEA found issue with DOE’s that the relationship between the
both commercial and residential terminology in the TSD, which stated transformer and system loads is not
customers were scaled by corresponding that DOE applies the joint histogram as random. For this NOPR DOE will
annual maxima prior to being counted a measure of correlation; and this is not continue to use the term correlation to
towards the joint histogram, so that the the typical interpretation of joint describe the general relationship
observations may be treated as if on a probability. NEEA further recommended between transformer and system loads,
per-unit basis. This is inconsistent with that a covariance-based measure (e.g., using footnotes to provide technical
the per-unit notion in power systems, correlation coefficient) is the precision as needed.
but permissible in this context if so appropriate class of metric in this case On the topic of industrial loads for
stated. However, the problem of bias because the subject load processes will liquid-immersed distribution
applied to an entire set of observations necessarily be related as a consequence transformers NEEA asserted that as
for a given transformer or ‘‘system’’ by of common influences, each of which is describe in the TSD appendix 7A, that
an abnormally large (or small) peak in turn a stochastic process. (NEEA, No. in the case of industrial customers,
observation is not acknowledged and 51 at pp. 2–3) In response, DOE agrees actual transformer load data were not
therefore not treated. (NEEA, No. 51 at with NEEA’s comment that the term available and would be problematic for
p. 2). DOE notes that the transformer ‘‘correlation’’ used in the TSD is not the estimation of the subject joint
data were screened to remove outliers appropriate. The system load is the sum histograms. (NEEA, No. 18 at p. 2) At
before being used to construct JPDFs; a of the loads on individual transformers, the time of the August 2021 Preliminary
small number of transformers in the so the system load and transformer Analysis TSD, DOE was unable to
database may none-the-less have quite loads are not independent random acquire the transformer loads from
large or quite small peak loads, but the variables. The relationship between the industrial customers. As discussed in
69 See: Distribution Transformer Load Simulation 70 https://www.ferc.gov/industries-data/electric/
Inputs, Technical Support Document, chapter 7. general-information/electric-industry-forms/form-

no-714-annual-electric/data.
TSD appendix 7A, DOE was able to liquid-immersed transformers, and zero suggesting utilities are already doing
include the hourly meter loads from percent for low- and medium-voltage this as the reported average peak loads
industrial customers, which contain dry-type transformers.71 On the subject were only 50 percent of nameplate
hourly variability in load factor, as of future load growth DOE received capacity. Utility decisions for how they
proxies for transformer loads—which comments from EEI, CDA, Howard, size transformers are unlikely to change
were included in its database of JPDFs. Efficiency Advocates, Metglas. and for new and replacement transformer
DOE requests comment or data NEMA. installations given the uncertainties
showing hourly transformer loads for Both EEI and CDA commented that around future electricity demand.
industrial customers. they believe that loads on individual (Efficiency Advocates, No. 52 at pp. 5–
NEEA additionally requested that liquid-immersed distribution 6) This notion was supported by NEMA
DOE rationalize the choice of bin transformers will increase over the who commented that as consumer
resolution in the joint histogram equipment’s lifetimes due to several demand (for electricity) increases due to
estimates. (NEEA, No. 51 at p. 2) In the factors. Both speculated that the the migration to all-electric homes and
August 2021 Preliminary Analysis TSD, increase in loads will be driven by buildings, and it stands to reason that
DOE applied the same methodology to evolving ‘‘mega trends’’ in the electric kVA sizes will increase over time as
the creation and population of JPDFs as utility industry, specifically increased utilities upgrade capacity to serve these
it did in the April 2013 Standards Final electric vehicle charging, and increased consumer demands. Likewise,
Rule. For the April 2013 Standards building electrification. (EEI No. 56 at p. investments in renewable energy
Final Rule, DOE balanced the bin 2; CDA No. 47 at p. 1) The CDA further generation will cause changes to
resolution to 10 bins to ensure that each commented that EEI has projected transformer shipments, unit sizes and
bin contained sufficient data to be loading increases of 10–50 percent over selections. (NEMA, No. 50 at p. 16)
sampled during its Monte Carlo the forecast period that will greatly As the August 2021 Preliminary
simulation (∼2 percent of samples per change operating practices in the Analysis TSD indicated, and by the
bin), this was also balanced against the utilities. This suggests the increasing comments received, there are many
computational limits of preforming this importance of transformer load losses as factors that potentially impact future
model within an Excel spreadsheet. For well as balance and minimization of distribution transformer load growth,
the August 2021 Preliminary Analysis total losses. (CDA, No. 47 at p. 2) and that these factors may be in
TSD, DOE considered increasing the bin Howard commented that we are at the opposition. At this time, many utilities,
count, but after testing found that this threshold of having many electric states, and municipalities are pursuing
did not significantly alter the resulting vehicles (EV) that will require a lot of electric vehicle charging programs, it is
averages, as such DOE elected to energy use through the transformer. unclear the extent to which increases in
maintain the approach that stakeholders How quickly this will happen, remains electricity demand for electric vehicle
were already familiar with. For this to be seen. (Howard, No. 59 at p. 3) charging, or other state level
NOPR, DOE will maintain the 10 bins NEMA commented that while they decarbonization efforts will impact
that were applied in the August 2021 could not state with certainty what the current distribution transformer sizing
Preliminary Analysis TSD. appropriate load growth rate would be, practices (for example, whether
2. Monthly Per-Unit Load (PUL) they disagreed with an assumption of distribution utilities plan to upgrade
zero percent load growth. (NEMA, No. their systems to increase the capacity of
Powersmiths commented that, in the 50 at p. 13)
context of low-voltage dry-type connected distribution transformers—
The Advocates, and Metglas
distribution transformers, it has thus maintaining current loads as a
challenged DOE application of a 0.9
consistently measured much lower function of distribution transformer
percent annual load growth for liquid-
typical loading levels, across most capacity; or if distribution utilities do
immersed distribution transformers.
vertical markets, in the range of 15–25 not plan to upgrade their systems and
Both asserted that the assumption of
percent of nameplate capacity, which is will allow the loads on existing
load growth rate applied to liquid-
in line with the publication in 1999 distribution transformers to rise). EEI,
immersed distribution transformers of
with the Cadmus Group Study and CDA, and Howard speculate that these
0.9 percent per year was not justified as
supported frequently since then in initiatives will increase the intensive
the National growth in electric demand
industry and at previous rulemaking per-unit-load over time as a function of
will be matched by increased
sessions. (Powersmiths, No. 46 at p. 1) per unit of installed capacity. However,
distribution capacity. They asserted that
DOE received no further comments on they did not provide any quantitative
the load growth rate assumed by DOE,
the in-field PUL for dry-type evidence that this is indeed happening
the average increase in annual
distribution transformers. Since the on the distribution systems, or regions
electricity sales from AEO, is not
comments from Powersmiths align with which are moving forward with
entirely driven by increased electrical
DOE’s analysis which shows an average decarbonization efforts. Further, the
load on existing liquid-immersed
RMS PUL for dry-type transformers to hypothesis that intensive load growth
distribution transformers, but in fact
be in 16–27 percent of nameplate will be a factor in the future is not
driven by grid expansion. (Advocates,
capacity DOE did not make any changes supported by the available future trends
No. 52 at pp. 5–6; Metglas, No. 53 at pp.
to its dry-type load model for this in AEO2022, as indicated by the
1, 5–6)
NOPR. purchased electricity trend as it
Additionally, the Advocates
represents the delivered electricity to
3. Future Load Growth commented that they believe utilities
the customer. The Advocates and
will plan conservatively by installing

In its August 2021 Preliminary Metglas asserted that the load growth
larger transformers capable of handling
Analysis TSD, DOE applied an annual rate 0.9 percent per year was too great,
rare peak demand events. Citing as
load growth rate of 0.9 percent, based on and that higher loads in response to
evidence the IEEE load data as
U.S. Energy Information Administration decarbonization initiatives would be
(‘‘EIA’’), Annual Energy Outlook 71 TSD chapter 2, p. 2–63, August 2021. https:// met with the extensive growth of the
(‘‘AEO’’) 2021 projected purchased www.regulations.gov/document/EERE-2019-BT- distribution system, i.e., increasing the
electricity: delivered electricity trend, to STD-0018-0040. total capacity of the distribution system
through larger distribution transformers, its nameplate rating, and associated efficient product through lower
or greater shipments, or some protection, at any time during its long operating costs. DOE calculates the PBP
combination of both. Again, neither the life. (Powersmiths No. 18 at p. 3) NEEA by dividing the change in purchase cost
Advocates nor Metglas provided any requested that for the next energy at higher efficiency levels by the change
data to support their position. For this conservation lookback that DOE include in annual operating cost for the year that
NOPR, DOE finds that neither position harmonic content in its analysis (NEEA amended or new standards are assumed
provides enough evidence to change its No. 18 at p. 4) to take effect.
assumptions from the August 2021 In response to the commenters For any given efficiency level, DOE
Preliminary Analysis TSD. For this regarding the inclusion of harmonic measures the change in LCC relative to
NOPR, DOE updated its load growth content, DOE agrees with NEEA and the LCC in the no-new-standards case,
assumption for liquid-immersed that in addition to determining the which reflects the estimated efficiency
distribution transformers based on the necessary input to adequately model the distribution of distribution transformers
change in average growth of AEO2022: impacts of harmonic content at the in the absence of new or amended
Purchased Electricity: Delivered National level, DOE would also have to energy conservation standards. In
Electricity at 0.5 percent.72 consider how changes in transformer contrast, the PBP for a given efficiency
To help inform DOE’s prediction of design would affect the availability of level is measured relative to the baseline
future load growth trend, DOE seeks designs and the impacts on efficiency. product.
data on the following for regions where DOE further concurs with Powersmiths For each considered efficiency level
decarbonization efforts are ongoing. that, on average, distribution in each product class, DOE calculated
DOE seeks hourly PUL data at the level transformers are lightly loaded, as the LCC and PBP for a nationally
of the transformer bank for each of the shown in its analysis (see section IV.E.2) representative set of electric distribution
past five years to establish an and that harmonic heat would not utilities, and commercial and industrial
unambiguous relationship between typically be an issue and would likely (‘‘C&I’’) customers. As stated previously,
transformer loads and decarbonization have minimal impact on the DOE developed these customers
policy and inform if any intensive load transformers covered by this NOPR. For samples from various sources, including
growth is indeed occurring. this NOPR DOE will not consider the utility data from the Federal Energy
Additionally, DOE seeks the average impacts of harmonic content but may Regulatory Commission (FERC), Energy
capacity of shipment into regions where examine them at a future date. Information Agency (EIA); and C&I data
decarbonization efforts are occurring DOE notes that the installation and from the Commercial Building Energy
over the same five-year period to inform commissioning of distribution Consumption Survey (CBECS), and
the rate of any extensive load growth transformers, either general purpose or Manufacturing Energy Consumption
that may be occurring in response to specialty equipment, falls outside the Survey (MECS). For each sample, DOE
these programs. Department’s authority and would be determined the energy consumption, in
under the purview of local building or terms of no-load and load losses for the
4. Harmonic Content/Non-Linear Loads fire codes and ordinances. distribution transformers and the
Harmonic current refers to electrical Chapter 7 of the NOPR TSD provides appropriate electricity price. By
power at alternating current frequencies details on DOE’s energy use analysis for developing a representative sample of
greater than the fundamental frequency. distribution transformers. consumer entities, the analysis captured
Distribution transformers in service are the variability in energy consumption
F. Life-Cycle Cost and Payback Period and energy prices associated with the
commonly subject to (and must tolerate) Analysis
harmonic current of a degree that varies use of distribution transformer.
by application. DOE conducted LCC and PBP Inputs to the calculation of total
Powersmiths commented that the analyses to evaluate the economic installed cost include the cost of the
effects of harmonic content on LVDT impacts on individual consumers of equipment—which includes MSPs,
can create significant customer risk due potential energy conservation standards retailer and distributor markups, and
to transformer overheating, particularly for distribution transformers. The effect sales taxes—and installation costs.
when the transformer is under heavy of new or amended energy conservation Inputs to the calculation of operating
loads. This was primarily an issue when standards on individual consumers expenses include annual energy
general purpose transformers are usually involves a reduction in consumption, electricity prices and
installed outside prescribed harmonic operating cost and an increase in price projections, repair and
limits. (Powersmiths No. 18 at p. 3) purchase cost. DOE used the following maintenance costs, equipment lifetimes,
Additionally, Powersmiths asserted two metrics to measure consumer and discount rates. DOE created
that because DOE does not account for impacts: distributions of values for equipment
harmonic content in its loading analysis b The LCC is the total consumer lifetime, discount rates, and sales taxes,
that it misrepresents the impact of expense of an appliance or product over with probabilities attached to each
additional heat on losses. Powersmiths the life of that product, consisting of value, to account for their uncertainty
concluded that light loading means the total installed cost (manufacturer selling and variability.
harmonic-related heat does not typically price, distribution chain markups, sales The computer model DOE uses to
threaten the transformer, but it is not an tax, and installation costs) plus calculate the LCC and PBP relies on a
excuse to leave this hidden risk unsaid operating costs (expenses for energy use, Monte Carlo simulation to incorporate
as the load on any given transformer maintenance, and repair). To compute uncertainty and variability into the
analysis. The Monte Carlo simulations
could be taken to full capacity based on the operating costs, DOE discounts
future operating costs to the time of randomly sample input values from the
72 www.eia.gov/outlooks/aeo/data/browser/#/ purchase and sums them over the probability distributions and
?id=2-AEO2022&region=1- lifetime of the product. distribution transformer samples. For
0&cases=ref2022&start=2020&end= b The PBP is the estimated amount this rulemaking, the Monte Carlo
2050&f=A&linechart=ref2022-d011222a.152-2-
AEO2022.1-0∼ref2022-d011222a.104-2-AEO2022.1-
of time (in years) it takes consumers to approach is implemented as a computer
0&map=ref2022-d011222a.4-2-AEO2022.1-0 recover the increased purchase cost simulation. The model calculated the
&ctype=linechart&sourcekey=0. (including installation) of a more- LCC and PBP for products at each
efficiency level for 10,000 individual consideration, the LCC and PBP the date on which any new or amended
distribution transformer installations calculation reveals that a consumer is standard is published. At this time, DOE
per simulation run. The analytical not impacted by the standard level. By estimates publication of a final rule in
results include a distribution of 10,000 accounting for consumers who already 2024. Therefore, for purposes of its
data points showing the range of LCC purchase more-efficient products, DOE analysis, DOE used 2027 as the first year
savings for a given efficiency level avoids overstating the potential benefits of compliance with any amended
relative to the no-new-standards case from increasing product efficiency. standards for distribution transformers.
efficiency distribution. In performing an DOE calculated the LCC and PBP for Table IV.7 summarizes the approach
iteration of the Monte Carlo simulation all consumers of distribution and data DOE used to derive inputs to
for a given consumer, product efficiency transformers as if each were to purchase the LCC and PBP calculations. The
is as a function of the consumer choice a new equipment in the expected year subsections that follow provide further
model described in section IV.F.3 of this of required compliance with new or discussion. Details of the model, and of
document. If the chosen equipment’s amended standards. Amended all the inputs to the LCC and PBP
efficiency is greater than or equal to the standards would apply to distribution analyses, are contained in chapter 8 of
efficiency of the standard level under transformers manufactured 3 years after the NOPR TSD and its appendices.
TABLE IV.7—SUMMARY OF INPUTS AND METHODS FOR THE LCC AND PBP ANALYSIS *
Inputs Source/method
Equipment Cost .............................. Derived by multiplying MPCs by manufacturer and retailer markups and sales tax, as appropriate. Used
historical data to derive a price scaling index to project product costs.
Installation Costs ............................. Assumed no change with efficiency level.
Annual Energy Use ......................... The total annual energy use multiplied by the hours per year. Average number of hours based on field
data.
Variability: Based on distribution transformer load data or customer load data.
Electricity Prices .............................. Hourly Prices: Based on EIA’s Form 861 data for 2015, scaled to 2021 using AEO2022.
Variability: Regional variability is captured through individual price signals for each EMM region.
Monthly Prices: Based on an analysis of EEI average bills, and electricity tariffs from 2019, scaled to 2021
using AEO2022.
Variability: Regional variability is captured through individual price signals for each Census region.
Energy Price Trends ....................... Based on AEO2022 price projections.
Repair and Maintenance Costs ...... Assumed no change with efficiency level.
Product Lifetime .............................. Average: 32 years, with a maximum of 60 years.
Discount Rates ................................ Approach involves identifying all possible debt or asset classes that might be used to purchase the consid-
ered equipment or might be affected indirectly. Primary data source was the Federal Reserve Board’s
Survey of Consumer Finances.
Compliance Date ............................ 2027.
* References for the data sources mentioned in this table are provided in the sections following the table or in chapter 8 of the NOPR TSD.
1. Equipment Cost the recent trend represents the conservation standards efficiency vs
beginning of a long-term rising trend kVA relationship, scaled to the larger
To calculate consumer product costs,
due to global demand for distribution kVA sizes. To calculate this, DOE scaled
DOE multiplied the MPCs developed in
transformers and rising commodity the maximum losses of the minimally
the engineering analysis by the markups
costs for key distribution transformer compliant 2,500 kVA unit to the 3,750
described previously (along with sales
components. Given the uncertainty, kVA size using the equipment class
taxes). DOE used different markups for
DOE chose to use constant prices (2021 specific scaling relationships in TSD
baseline products and higher-efficiency
levels) for both its LCC and PBP analysis appendix 5C. For example, a 2,500 kVA
products, because DOE applies an
and the NIA. For the NIA, DOE also unit that meets current energy
incremental markup to the increase in
analyzed the sensitivity of results to
MSP associated with higher-efficiency conservation standards is 99.53 percent
alternative distribution transformer
products. efficient and has 5903 W of loss at 50
price forecasts.
To forecast a price trend for this DOE did not receive any comments percent load. Using the 0.79 scaling
NOPR, DOE maintained the approach regarding its determination of future relationship for three-phase liquid-
employed in the August 2021 equipment costs and did not make any immersed distribution transformers,
Preliminary Analysis TSD, where it changes for this NOPR. described in appendix 5C, the losses of
derived an inflation-adjusted index of a 3,750 kVA unit would be 8131 W,
the Producer Price Index (‘‘PPI’’) for 2. Efficiency Levels corresponding to 99.57 percent efficient
electric power and specialty transformer For this NOPR, DOE analyzed at 50 percent load.
manufacturing from 1967 to 2019.73 different efficiency levels, these are EL2 through EL5 align with the same
These data show a long-term decline expressed as a function of loss reduction
percentage reduction in loss as their
from 1975 to 2003, and then increase over the equipment baseline. For units
respective EC but rather than being
since then. There is considerable greater than 2,500 kVA, there is not a
uncertainty as to whether the recent current baseline efficiency level that relative to a baseline level, efficiency
trend has peaked, and would be must be met. Therefore, DOE levels were established relative to EL1
followed by a return to the previous established EL1 for these units as if they levels.
long-term declining trend, or whether were aligning with the current energy
73 For this NOPR DOE maintained its use of the Bureau of Labor Statistics for: Electric power and Power and distribution transformers PPI
two Produce Price Indexes published by the U.S. specialty transformer PPI (PCU335311335311), and (PCU3353113353111).
The rate of reduction is shown in

Table IV.8, and the corresponding
efficiency ratings in Table IV.9.
TABLE IV.8—EFFICIENCY LEVELS AS PERCENTAGE REDUCTION OF BASELINE LOSSES

EL
Equipment type 5
1 2 3 4 (max-tech)
Liquid-immersed:
≤2,500 kVA ................................................................... 2.5 5 10 20 40
>2,500 kVA ................................................................... * 40 ** 5 ** 10 ** 20 ** 40
Low-voltage Dry-type:
1j .................................................................................. 10 20 30 40 50
3j .................................................................................. 5 10 20 30 40
Medium-voltage Dry-type:
<46 kV BIL .................................................................... 5 10 20 30 40
≥46 and <96 kV BIL, and ≤2,500 kVA ......................... 5 10 20 30 40
≥46 and <96 kV BIL, and >2,500 kVA ......................... * 43 ** 10 ** 20 ** 30 ** 40
≥96 kV BIL and ≤2,500 kVA ......................................... 5 10 20 30 35
≥96 kV BIL and >2,500 kVA ......................................... * 34 ** 10 ** 20 ** 30 ** 35
* Equipment currently not subject to standards. Therefore, reduction in losses relative to least efficient product on market.
** Reduction in losses relative to EL1.
TABLE IV.9—EFFICIENCY LEVELS

Efficiency level
Rep. unit kVA
0 1 2 3 4 5
1 ................................... 50 99.11 99.13 99.15 99.20 99.29 99.46

2 ................................... 25 98.95 98.98 99.00 99.05 99.16 99.37
3 ................................... 500 99.49 99.50 99.52 99.54 99.59 99.69
4 ................................... 150 99.16 99.18 99.20 99.24 99.33 99.49
5 ................................... 1,500 99.48 99.49 99.51 99.53 99.58 99.69
6 ................................... 25 98.00 98.20 98.39 98.60 98.79 98.99
7 ................................... 75 98.60 98.67 98.74 98.88 99.02 99.16
8 ................................... 300 99.02 99.07 99.12 99.22 99.31 99.41
9 ................................... 300 98.93 98.98 99.04 99.14 99.25 99.36
10 ................................. 1,500 99.37 99.40 99.43 99.50 99.56 99.62
11 ................................. 300 98.81 98.87 98.93 99.05 99.16 99.28
12 ................................. 1,500 99.30 99.33 99.37 99.44 99.51 99.58
13 ................................. 300 98.69 98.75 98.82 98.95 99.08 99.14
14 ................................. 2,000 99.28 99.32 99.35 99.42 99.49 99.53
15 ................................. 112.5 99.11 99.13 99.15 99.20 99.29 99.46
16 ................................. 1,000 99.43 99.44 99.46 99.49 99.54 99.66
17 ................................. 3,750 n.a. 99.57 99.59 99.61 99.66 99.74
18 ................................. 3,750 n.a. 99.48 99.53 99.58 99.64 99.69
19 ................................. 3,750 n.a. 99.41 99.47 99.53 99.59 99.62
DOE did not receive any comment an approach that focuses on the based on TOC is rare, instead customers
regarding the loss rates, nor the selection criteria customers are known have been purchasing the lowest first
efficiency levels applied in the to use when purchasing distribution cost transformer design regardless of its
preliminary analysis, and continued transformers. Those criteria include first loss performance.
their use for this NOPR. costs, as well as the Total-Owning Cost The utility industry developed TOC
DOE requests comments on its (‘‘TOC’’) method. The TOC method evaluation as a tool to reflect the unique
methodology for establishing the energy combines first costs with the cost of financial environment faced by each
efficiency levels for distribution losses. Purchasers of distribution distribution transformer purchaser. To
transformers greater than 2,500 kVA. transformers, especially in the utility express variation in such factors as the
DOE request comment on its assumed sector, have historically used the TOC cost of electric energy, and capacity and
energy efficiency ratings. method to determine which distribution financing costs, the utility industry
transformers to purchase. However, developed a range of evaluation factors:

3. Modeling Distribution Transformer A and B values, to use in their
Purchase Decision comments received from stakeholders
responding to the 2012 ECS NOPR (77 calculations.74 A and B are the
In the August 2021 Preliminary FR 7323) and the June 2019 RFI (84 FR
74 In modeling the purchase decision for
Analysis TSD, DOE presented its 28254) indicate that the widespread
distribution transformers DOE developed a
assumption on how distribution practice of concluding the final probabilistic model of A and B values based on
transformers were purchased. DOE used purchase of a distribution transformer Continued
equivalent first costs of the no-load and stated that currently the fraction of limited quantities, supporting Metglas’
load losses (in $/watt), respectively. amorphous core distribution claim. The reason for this is believed to
In response to the August 2021 transformers is on the order of 2–3 be limitations in amorphous core
Preliminary Analysis TSD, DOE percent of the market and that this fabricating capacity among
received the following comments fraction has been constant for the past manufacturers. DOE’s research indicates
regarding the modeling of distribution 7 years. (Metglas, No. 53 at pp. 1–2) that distribution transformers can be
transformer purchases. Additionally, the Efficiency Advocates fabricated with amorphous core steels
a. Basecase Equipment Selection recommended that DOE take ‘‘a hard that are cost competitive with
look at’’ the purchasing behaviors of conventional steels as shown in the
Regarding how engineering designs
distribution transformers in the current engineering analysis (see section IV.C),
were selected by the consumer choice
marketplace. (Efficiency Advocates, No. but they cannot currently be fabricated
model in the LCC, DOE received
comments from Metglas and the 40 at p. 83) in the quantities needed to meet the
Efficiency Advocates. Metglas In response to these comments DOE large order requirement of electric
commented that it did not agree with examined its responses received during utilities, and as such, are limited to
the DOE purchase decision model. manufacturer interviews. From these niche products. Accordingly, DOE has
Stating that the fraction of designs using responses, DOE understands that in the updated its customer choice model and,
amorphous steel as a core material were current market that amorphous core in the no-new standards case has
grossly overstated in the standards, and distribution transformers (both liquid- limited type of core steel materials to
no-new standards cases. Metglas further immersed and dry-type) are shipped in the ratios shown in Table IV.10.
TABLE IV.10—CORE MATERIAL LIMITS IN THE NO-NEW STANDARDS CASE

Baseline Steel for Liquid-Immersed: Baseline Steel for Dry-Type:
• 87% M3 or 23hib090. • 97% M4 or hib-M4 (M3 as modeled).
• 3% Amorphous (mostly in TOC applications above standards). • 3% PDR.
• 10% 23PDR085. • 0% AM.
Based on interviews with from several stakeholders regarding the DOE estimated the rate of consumers
manufactures, and supporting research, rates at which TOC are practiced. using TOC as a tool to inform the
DOE finds that there are no global NEMA commented that the purchase of a distribution transformer to
supply constraints of amorphous ribbon experience among their members varies, be 10 percent for liquid-immersed
for fabrication into transformer cores. but in NEMA’s experience the distribution transformers. These rates
And in the potential new-standards percentage of TOC use in purchasing were established in response to
case, DOE does not limit the selection stakeholder comments in the February
decisions for three-phase designs is
of the designs in the engineering 2012 NOPR (77 FR 7323) to which DOE
higher than 10 percent: varying between
database by core material type. Further, received no adverse comments. Further,
15–20 percent, and for single-phase
DOE understands that there are current these rates were again put forward for
designs, they believe the use of TOC in comment in the June 2019 RFI (84 FR
production limitations for turning
amorphous ribbons into transformer purchasing decisions is closer to 40 28254) to which DOE did not receive
cores that would require the capital percent. (NEMA, No. 50 at p. 13) any adverse comments.75 In light of this
investment in ribbon cutting, and core Additionally, NEMA responded to long history of established low rates of
stacking machines at higher intensities DOE’s request for information relating TOC adoption for the purchase of
to meet the quantity requirements customer application of TOC as a distribution transformers DOE finds the
placed on manufacturers by electric function of distribution transformer comments received from NEMA to be
utilities. The impacts of the additional capacity. NEMA responded that NEMA inconsistent with historical comments
capital investment on manufacturers in did not have detailed information on from a wide range of stakeholders. Ibid.
the potential new-standards case are breakouts of TOC purchasing influence For this NOPR, DOE is maintaining the
captured in manufacturer impact by kVA and that their members are same rates of TOC evaluators
analysis described in section IV.J of this investigating whether their customer established in the August 2021 ECS
document. information can be analyzed for useful Preliminary Analysis TSD, however,
insight on this subject (NEMA, No. 50 DOE recognizes that circumstances
b. Total Owning Cost (‘‘TOC’’) and at pp. 13–14) Metglas commented that change over time and has included in
Evaluators few transformer purchasers are using this NOPR a LCC sensitivity case with
In the August 2021 Preliminary TOC evaluations, and 10 percent may be evaluation rates suggested by NEMA.
Analysis TSD, DOE used TOC a reasonable estimate for those still The result of this sensitivity analysis
evaluation rates as follows: 10 percent using TOC. And in their experience the can be found in appendix 8G of the
of liquid-immersed transformer few remaining TOC evaluators reveal TSD.
purchases were concluded using TOC, that they will abandon TOC as soon as Powersmiths commented that it is not
and 0 percent of low-voltage dry-type their existing tenders are delivered.; true that 100 percent of LVDT
and medium-voltage dry-type leading to speculation that this practice distribution transformers are purchased
transformer purchases were concluded could be nearly extinct within the next on minimum first cost, adding that their
using TOC. DOE received comment 2–3 years. (Metglas, No. 53 at p. 6) market is selling only distribution
utility requests for quotations when purchasing a utility might use when making a purchase Preliminary Analysis, Technical Support
distribution transformers. In the context of the LCC decision. Document, p 2–69; https://www.regulations.gov/
75 Please see the summary of comments regarding
the A and B model estimates the likely values that document/EERE-2019-BT-STD-0018-0023.
the rate of evaluators in the August 2021 ECS
transformers that significantly exceed Based on the comments received DOE capacity or number of phases. Further,
minimum efficiency standards and the will maintain the definition previously DOE seeks the fraction of distribution
NEMA Premium transformer market stated. However, for this NOPR, DOE transformer sales using either method
existed prior to the 2016 energy did not receive enough information or into the different regions in order to
conservation standards. (Powersmiths, data to apply BOE to a fraction of capture the believed relationship
No. 46 at pp. 3–4) Powersmiths transformer purchasers. between higher electricity costs and
commented that minimum efficiency is Evaluation Rates and High Electricity purchase evaluation behavior.
rarely the optimal choice for consumers Costs
and there is value in both new c. Non-evaluators and First Cost
construction and retrofits that exceed In the August 2021 ECS Preliminary Purchases
energy conservation standards. Analysis TSD, DOE requested comment
(Powersmiths, No. 46 at p. 4) on whether those consumers that DOE defined those consumers who do
Powersmiths added that trends toward purchase distribution transformers not purchase based on TOC as those
green buildings have increased the based on TOC are likely to pay higher who purchase based on lowest first
number of consumers looking at value electricity costs. Howard commented costs. NEMA commented that they
beyond first cost which may increase that certain utilities with high electricity disagreed with DOE’s assumption that
the value-added LVDT market. costs use the TOC (Total Owning Cost) purchasers who do not purchase based
(Powersmiths, No. 46 at p. 4) approach to minimize their overall on TOC purchase strictly on a first cost
owning costs. And the manufacturer basis. Stating, in relation to dry-type
DOE recognizes that distribution
will work with the user to determine the distribution transformers, that
transformers are purchased at different
best overall value to buy, and that this customers also care about production
efficiency levels depending on the
is good approach in those areas. times, availability, perceived quality,
specific demands of consumers. For this
(Howard, No. 59 at p. 3) NEMA design options and other factors relating
analysis DOE did not receive a specific
commented that it stands to reason that
fraction of LVDT distribution to timing and performance. Further, in
consumers with higher electricity costs
transformers that were sold above the relation to liquid-immersed
are more likely to consider TOC in
current standard, in the absence of such transformers, improved tank steel
purchasing decisions. (NEMA, No. 50 at
information DOE relied on the (stainless) or biodegradable immersion
p. 13–14)
consumer choice model to determine The comments DOE received on this oil are potential upgrades outside
the equipment price in addition to the subject were supportive of the notion electrical performance which NEMA
fraction of equipment sold with higher that consumers who have higher members have had requested by
performance cores constructed from electricity costs would reasonably have customers. (NEMA, No. 50 at pp. 13–14)
PDR steel, as discussed in section higher adoption of using TOC as a DOE acknowledges that customers of
IV.F.3.a of this document. purchasing tool. However, the distribution transformers will specify
Band of Equivalents (‘‘BOE’’) comments did not provide any design aspects, or other criteria that will
information, or data to support impact the cost of a transformer when
In the August 2021 Preliminary including this relationship in this
Analysis TSD, DOE proposed the making a purchasing decision that is not
NOPR. To relate higher electricity costs related to distribution transformer
following definition for Band of with increased TOC use, DOE would
Equivalents (‘‘BOE’’): as a method to efficiency. As mentioned by NEMA in
require from stakeholders the fraction of
establish equivalency between a set of their comment, customers may have
transformers specified and shipped to
transformer designs within a range of additional criteria when purchasing a
regions of higher electricity costs using
similar TOC. BOE is defined as those TOC or BOE. distribution transformer that would be
transformer designs within a range of DOE requests comment on its considered either an equipment upgrade
similar TOCs; the range of TOC varies assumed TOC adoption rate of 10 outside of the equipment’s electrical
from utility to utility and is expressed percent. Specifically, DOE requests performance, or operational
in percentage terms. In practice, the comment on the TOC rate suggested by considerations that would affect the first
purchaser would consider the TOC of NEMA, that between 15 and 20 percent costs. The analysis conducted by the
the transformer designs within the BOE of 3-phase liquid-immersed distribution Department in support of its energy
and would select the lowest first-cost transformers are purchased using TOC, saving mission are limited to design
design from this set. and that 40 percent of 1-phase liquid- aspects that affect the quantification of
NEMA agreed with the Department’s immersed distribution transformers are increased energy efficiency of the
assumptions with respect to their purchased using TOC. DOE notes, that equipment in question, in this case,
reflection of industry experiences and it is seeking data related to concluded distribution transformers. These design
practices. NEMA further stated that its sales based on lowest TOC in the aspects are defined in the current test
members are investigating whether their strictest sense, excluding those procedure and quantified in the
customer information can be analyzed transformers sold using band of engineering analysis. Since the aspects
for useful insight on this subject. equivalents (see the section on band of listed by NEMA are outside of the
(NEMA, No. 50 at p. 13) Metglas equivalents, above) electrical, and efficiency performance of
comment that BOE within a TOC DOE requests comment on the distribution transformers, therefore they
calculation is often used because the fraction of distribution transformers are not considered in this analysis.
assumptions within the TOC
purchased by customers using the BOE

calculations are estimates. BOE can be methodology. DOE notes, that it is 4. Installation Costs
up to 10 percent of TOC, meaning the seeking data related to concluded sales
TOC evaluations within this band are based on lowest BOE in the strictest Installation cost includes labor,
treated as equal, and when used in lieu sense, excluding those transformers sold overhead, and any miscellaneous
of TOC, the fraction of consumers who using total owning costs. materials and parts needed to install the
evaluate using TOC drops to less than DOE request comment if the rates of product. DOE used data from RSMeans
5 percent. (Metglas, No. 53 at p. 7) TOC or BOE vary by transformer to estimate the baseline installation cost
for distribution transformers.76 In the appendix 7D of the August 2021 generation, transmission, and
August 2021 Preliminary Analysis TSD, Preliminary Analysis TSD, many of distribution costs. The general structure
DOE asserted that there would be no these issues can be avoided through of the hourly marginal cost methodology
difference in installation costs between proper equipment specification at the divides the costs of electricity into
baseline and more efficient equipment. time of purchase. The issues that both capacity components and energy cost
DOE also asserted that 5 percent of Carte and NEMA reference, apart from components. For each component, the
replacement installations would face vault replacement/renovation, can be economic value for both no-load losses
increased costs over baseline equipment addressed during purchasing with and load losses is estimated. The
due to the need for site modifications. proper specifications. Given that no new capacity components include generation
DOE received comments from GEUS, information has been put forward in and transmission capacity; they also
Carte, and NEMA of the subject of response to the August 2021 include a reserve margin for ensuring
installing distribution transformers. Preliminary Analysis TSD, DOE will system reliability, with factors that
GEUS expressed concern that higher maintain its assumptions and approach account for system losses. Energy cost
standards may increase transformer where increased installation costs over components include a marginal cost of
weights such that 50 kVA transformers the no-new standards case are supply that varies by the hour.
can no longer be handled with standard considered atypical and applied at a rate The marginal costs methodology was
bucket trucks and would require a larger of 5 percent of installations occurrences. developed for each regional Balancing
truck to preform installations. (GEUS, For this NOPR, DOE reiterates its Authority listed in EIA’s Form EIA–861
No. 58 at p. 1) request for the following information. database (based on ‘‘Annual Electric
The load bearing capacity of vehicles DOE requests data and feedback on the Power Industry Report’’).77 To calculate
classified as a bucket truck typically size limitations of pad-mounted the hourly price of electricity, DOE used
accommodate a wide range of lifting distribution transformers. Specifically, the day-ahead market clearing price for
capacity depending on each individual what sizes, voltages, or other features regions having wholesale electricity
truck. The analysis conducted for this are currently unable to fit on current markets, and system lambda values for
NOPR shows a maximum of weight for pads, and the dimension of these pads. all other regions. System lambda values,
a 50 kVA pole mounted liquid- DOE seeks data on the typical concrete which are roughly equal to the operating
immersed distribution of 1440 lbs. at the pad dimensions for 50 and 500 kVA cost of the next unit in line for dispatch,
maximum technology case. Without single-; and 500, and 1500 kVA three- are filed by control area operators under
knowing the specifics regarding the phase distribution transformers. DOE FERC Form 714.78
equipment used by GEUS, DOE cannot seeks data on the typical service EEI commented that the utilization of
definitively say whether their existing lifetimes of supporting concrete pads. 2015 data and ‘‘scaling it’’ to the year of
bucket trucks will be sufficient. analysis was misguided given the clean
5. Annual Energy Consumption energy progress the electric sector has
Transformers are typically installed
using a bucket truck, or crane truck. For each sampled customer, DOE made in the intervening years. The mix
DOE requests comment on the typical determined the energy consumption for of resources used to generate electricity
maximum lifting capacity, and the a distribution transformer at different in the United States has changed
typical transformer capacity being efficiency levels using the approach dramatically over the last decade and is
installed. described previously in section IV.E of increasingly cleaner. EEI commented
Additionally, Carte and NEMA this document. that, starting in 2016, natural gas
expressed concern over the increasing of surpassed coal as the main source of
6. Electricity Prices electricity generation in the United
distribution transformer size in order to
meet a potential revised standard. Carte DOE derived average and marginal States, and in 2020 natural gas-based
commented that utilities are concerned electricity prices for distribution generation powered 40 percent of the
with the increase in size and weight transformers using two different country’s electricity, compared to coal-
associated with efficiency standards, methodologies to reflect the differences based generation at 19 percent.
with potential issues for pole in how the electricity is paid for by In response to EEI, DOE notes that it
replacement, concrete load limits, and consumers of distribution transformers. scaled the cost of electricity from 2015
vaults. (Carte, No. 54 at p. 2–3) NEMA For liquid-immersed distribution to the present using AEO2022 electricity
commented that when designing a new transformers, which are largely owned price trend, and that this trend accounts
transformer to fit an existing pad and operated by electric distribution for changes in the electricity supply mix
footprint, the only way to add more companies, who purchase electricity over this period.79 Additionally, DOE
active material to raise efficiency is to from a variety of markets, DOE captures the advances in reducing GHG
increase the height of the unit. This may developed an hourly electricity costs and other pollutants from the Nation’s
not be feasible in situations where model. For low- and medium-voltage electricity generators in its Emissions
cables run underground. There may not dry-type, which are primarily owned
77 Available at https://www.eia.doe.gov/cneaf/
be sufficient length remaining in those and operated by C&I entities, DOE
electricity/page/eia861.html.
cables to reach a higher set of bushings developed a monthly electricity cost 78 https://www.ferc.gov/industries-data/electric/
to connect the unit to the network. model. general-information/electric-industry-forms/form-

(NEMA, No. 50 at p. 14) no-714-annual-electric/overview.
a. Hourly Electricity Costs 79 U.S. Energy Information Administration,
As in the August 2021 Preliminary
To evaluate the electricity costs Annual Energy Outlook 2022, Table 3. Energy
Analysis TSD, DOE acknowledges that Prices by Sector and Source Case: AEO2022
associated with liquid-immersed
there may be issues when installing a Reference case | Region: United States, 2022
distribution transformers, DOE used
replacement distribution transformer on (Available at: https://www.eia.gov/outlooks/aeo/
marginal electricity prices. Marginal data/browser/#/?id=3-AEO2022&region=1-0&
an existing pad, or underground
prices are those utilities pay for the last cases=ref2022&start=2020&end=2050&f=A
enclosure. However, as discussed in &linechart=ref2022-d011222a.3-3-AEO2022.1-
kilowatt-hour of electricity produced
0∼ref2022-d011222a.55-3-AEO2022.1-0&
76 Gordian, RSMeans Online, https:// that may be higher or lower than the map=ref2022-d011222a.4-3-AEO2022.1-0
www.rsmeans.com/products/online (Last accessed: average price, depending on the &ctype=linechart&sourcekey=0, Last access: June 1,
March 2022). relationships among capacity, 2022).
Analysis, described in section IV.K. representative. (NEMA, No. 50 at p. 16) for the different types of distribution
This analysis captures both shift in However, NEMA postulated that, transformer owners.
generation, and the reduction in coal- logically, increased (equipment) prices DOE’s method views the purchase of
based generation, and resulting will create pressure on some customers a higher efficiency appliance as an
emissions referenced by EEI, from 2027 to rebuild existing property. NEMA did investment that yields a stream of
through the end of this this NOPR’s not provide the additional service life energy cost savings. DOE derived the
analysis period. that would be extended to rebuilt discount rates for the LCC analysis by
DOE received no further comment equipment in this event, or to what estimating the cost of capital for
regarding it electricity costs analysis extent the average service lifetime of a companies or public entities that
and maintained the approach used in distribution transformer would increase. purchase distribution transformers. For
the August 2021 Preliminary Analysis As the average lifetime presented in the private firms, the weighted average cost
TSD for this NOPR. August 2021 Preliminary Analysis TSD, of capital (WACC) is commonly used to
at 32 years, is quite long, for this NOPR, estimate the present value of cash flows
7. Maintenance and Repair Costs DOE maintained the lifetime estimates to be derived from a typical company
Repair costs are associated with presented in the August 2021 project or investment. Most companies
repairing or replacing product Preliminary Analysis TSD. use both debt and equity capital to fund
components that have failed in an DOE request the average extension of
investments, so their cost of capital is
appliance; maintenance costs are distribution transformer service life that
the weighted average of the cost to the
associated with maintaining the can be achieved through rebuilding.
firm of equity and debt financing, as
operation of the product. Typically, Additionally, DOE requests comment on
estimated from financial data for
small incremental increases in product the fraction of transformer that are
publicly traded firms in the sectors that
efficiency produce no, or only minor, repaired by their original purchasing
purchase distribution transformers.80 As
changes in repair and maintenance costs entity and returned to service, thereby
discount rates can differ across
compared to baseline efficiency extending the transformer’s service
industries, DOE estimates separate
products. In the August 2021 lifetime beyond the estimated lifetimes
discount rate distributions for a number
Preliminary Analysis TSD, DOE asserted of 32 years with a maximum of 60 years.
of aggregate sectors with which
that maintenance and repair costs do 9. Discount Rates elements of the LCC building sample
not increase with transformer efficiency.
The discount rate is the rate at which can be associated.
NEMA responded that they agree with
these assumptions. (NEMA, No. 50 at p. future expenditures are discounted to EEI commented that DOE should
16) estimate their present value. DOE utilize up to date information to apply
Based on this response DOE employs a two-step approach in an appropriate discount rate for electric
continued its assumptions that calculating discount rates for analyzing companies. (EEI, No. 56 at p. 4) DOE
maintenance and repair costs do not customer economic impacts (e.g., LCC). understands that this comment is in
increase with transformer efficiency for The first step is to assume that the reference to DOE applying the Federal
this NOPR analysis. actual cost of capital approximates the Government discount rate to local
appropriate customer discount rate. The Municipal Utilities (MUNIs) consumers
8. Equipment Lifetime second step is to use the capital asset in the LCC analysis in the August 2021
For distribution transformers, DOE pricing model (CAPM) to calculate the Preliminary Analysis TSD. This was in
used a distribution of lifetimes, with an equity capital component of the error and has been corrected in this
estimated average of 32 years and customer discount rate. For this NOPR, NOPR; consumer impacts for MUNIs are
maximum 60 years. DOE estimated a statistical distribution now calculated using the distribution of
NEMA commented that they have no of commercial customer discount rates state/local government discount rates
alternative lifetimes to suggest, and the that varied by distribution transformer shown in Table IV.11. The mean WACC
equipment lifetimes are suitably type, by calculating the cost of capital for this distribution is 2.67 percent.81
TABLE IV.11—APPLIED DISCOUNT RATES FOR PUBLICLY OWNED UTILITIES

Rates Weight Observations
Rate bin (%) (%) (quarters)
<0% .............................................................................................................................................. ¥1.9 3.0 4

0–1% ............................................................................................................................................ 0.9 2.3 3
1–2% ............................................................................................................................................ 1.6 23.3 31
2–3% ............................................................................................................................................ 2.5 25.6 34
3–4% ............................................................................................................................................ 3.5 35.3 47
4–5% ............................................................................................................................................ 4.2 10.5 14
DOE received no further comments on further details on the development of 10. Energy Efficiency Distribution in the
its discount rate analysis and consumer discount rates. No-New-Standards Case
maintained its approach for this NOPR.
See chapter 8 of the NOPR TSD for To accurately estimate the share of
consumers that would be affected by a
80 Previously, Damodaran Online provided firm- 81 Sources: For values through Q2 2016, Federal Associates LLC, ‘‘20 Year AA Municipal Bond
level data, but now only industry-level data is Reserve Bank of Saint Louis, ‘‘State and Local Quarterly Rates,’’ updated January 5, 2022, https://
available, as compiled from individual firm data, Bonds—Bond Buyer Go 20-Bond Municipal Bond bartel-associates.com/resources/select-gasb-67-68-
for the period of 1998–2018. The data sets note the Index—Discontinued Series,’’ https:// discount-rate-indices (Last accessed February 2022).
number of firms included in the industry average fred.stlouisfed.org/series/WSLB20 (Last accessed
for each year. February 2022). For Q3 2016 through 2021, Bartel
potential energy conservation standard TOC. In the no-new-standards case resulting distribution of transformer
at a particular efficiency level, DOE’s distribution transformers are chosen efficiency in the No-New-Standards
LCC analysis considered the projected from among the entire range of available Case is shown in Table IV.12.
distribution (market shares) of product distribution transformer designs for Comments received regarding the
efficiencies under the no-new-standards each representative unit simulated in energy efficiency distribution in the no-
case (i.e., the case without amended or the engineering analysis based on this
new-standards case are addressed in the
new energy conservation standards). To purchase-decision model. This selection
discussion regarding the modeling of
determine an appropriate basecase is constrained only by purchase-price in
against which to compare various the majority of cases (90 percent, and distribution transformer purchase
potential standard levels, DOE used the 100 percent for liquid-immerses, and all decisions, in section IV.F.2 of this
purchase-decision model described in dry-type transformers, respectively), and document.
section IV.F.3, where distribution reflect the MSPs of the available designs See chapter 8 of the NOPR TSD for
transformers are purchased based on determined in the engineering analysis further information on the derivation of
either lowest first cost, or, on lowest in section IV.C.1 of this document. The the efficiency distributions.
TABLE IV.12—APPLIED DISTRIBUTION OF EQUIPMENT EFFICIENCIES IN THE NO-NEW STANDARDS CASE, FRACTION OF
UNITS AT EACH EL (%)
Efficiency level
EC Rep unit
0 1 2 3 4 5
1 ................................... 1 90.6 6.1 0.3 0.9 1.6 0.4

1 ................................... 2 99.1 0.3 0.4 0.1 0.0 0.0
1 ................................... 3 96.5 1.0 2.2 0.1 0.2 0.1
2 ................................... 4 65.0 30.7 1.2 0.1 2.1 0.9
2 ................................... 5 93.5 4.2 1.7 0.6 0.0 0.0
2 ................................... 17 97.7 0.2 0.3 0.8 0.8 0.2
12 ................................. 15 64.8 31.4 0.8 0.0 2.1 0.9
12 ................................. 16 93.9 3.9 1.6 0.4 0.0 0.0
3 ................................... 6 31.4 46.4 21.3 0.9 0.0 0.0
4 ................................... 7 83.4 15.1 1.5 0.0 0.0 0.0
4 ................................... 8 49.0 45.1 6.0 0.0 0.0 0.0
6 ................................... 9 28.0 50.0 22.0 0.0 0.0 0.0
6 ................................... 10 87.5 12.5 0.0 0.0 0.0 0.0
8 ................................... 11 76.2 23.8 0.0 0.0 0.0 0.0
8 ................................... 12 90.6 9.4 0.0 0.0 0.0 0.0
8 ................................... 18 100.0 0.0 0.0 0.0 0.0 0.0
10 ................................. 13 90.4 9.7 0.0 0.0 0.0 0.0
10 ................................. 14 100.0 0.0 0.0 0.0 0.0 0.0
10 ................................. 19 100.0 0.0 0.0 0.0 0.0 0.0
Note: may not sum to 100 due to rounding.
11. Payback Period Analysis than three times the value of the first G. Shipments Analysis
year’s energy savings resulting from the DOE uses projections of annual
The payback period is the amount of
time it takes the consumer to recover the standard, as calculated under the product shipments to calculate the
additional installed cost of more- applicable test procedure. (42 U.S.C. national impacts of potential amended
efficient products, compared to baseline 6295(o)(2)(B)(iii)) For each considered or new energy conservation standards
products, through energy cost savings. efficiency level, DOE determined the on energy use, NPV, and future
Payback periods are expressed in years. value of the first year’s energy savings manufacturer cash flows.82 The
Payback periods that exceed the life of by calculating the energy savings in shipments model takes an accounting
the product mean that the increased accordance with the applicable DOE test approach, tracking market shares of
total installed cost is not recovered in procedure, and multiplying those each product class and the vintage of
reduced operating expenses. savings by the average energy price units in the stock. Stock accounting uses
The inputs to the PBP calculation for projection for the year in which product shipments as inputs to estimate
each efficiency level are the change in compliance with the amended standards the age distribution of in-service
total installed cost of the product and would be required. The results of this product stocks for all years. The age
the change in the first-year annual analysis provide an important element distribution of in-service product stocks
operating expenditures relative to the of DOE’s evaluation of the economic is a key input to calculations of both the
baseline. The PBP calculation uses the justification for a potential standard NES and NPV, because operating costs
same inputs as the LCC analysis, except level (thereby supporting or rebutting for any year depend on the age
that discount rates are not needed. the results of any preliminary distribution of the stock.
As noted previously, EPCA determination of economic DOE projected distribution

establishes a rebuttable presumption justification). The rebuttable transformer shipments for the no-new
that a standard is economically justified presumption payback calculation is standards case by assuming that long-
if the Secretary finds that the additional discussed in section V.B.1.c of this 82 DOE uses data on manufacturer shipments as
cost to the consumer of purchasing a document. a proxy for national sales, as aggregate data on sales
product complying with an energy are lacking. In general one would expect a close
conservation standard level will be less correspondence between shipments and sales.
term growth in distribution transformer manufacturers via confidential shipments of dry-type distribution
shipments will be driven by long-term interviews, resulting in revised transformers would be equal to the
growth in electricity consumption. DOE shipments estimates for liquid- growth in electricity consumption for
developed its initial shipments inputs immersed distribution transformers. commercial and industrial sectors,
based on data from the previous final DOE developed the shipments respectively. The model starts with an
rule, and data submitted to DOE from projection for liquid-immersed estimate of the overall growth in
interested parties; these initial distribution transformers by assuming distribution transformer capacity, and
shipments are shown for the assumed that annual shipments growth is equal then estimates shipments for particular
compliance year, by distribution to growth in electricity consumption for representative units and capacities
transformer type, in Table IV.13 through all sectors, as given by the AEO2022 using estimates of the recent market
Table IV.15. For this NOPR, DOE forecast through 2050. DOE’s model shares for different design and size
received additional data from assumed that growth in annual categories.
TABLE IV.13—ESTIMATED LIQUID-IMMERSED SHIPMENTS FOR 2027 (UNITS)

Capacity
(kVA) Pad OH Pad OH NVS
10 ......................................................................................... 677 71,325 0 0 0

15 ......................................................................................... 4,679 147,344 0 0 0
25 ......................................................................................... 44,873 329,589 0 0 0
30 ......................................................................................... 0 0 10 68 0
38 ......................................................................................... 8,184 45,629 0 0 0
45 ......................................................................................... 0 0 714 692 0
50 ......................................................................................... 79,074 149,710 0 0 0
75 ......................................................................................... 42,684 24,149 6,523 661 0
100 ....................................................................................... 32,830 20,537 0 0 0
113 ....................................................................................... 0 0 1,773 95 0
150 ....................................................................................... 0 0 13,066 787 0
167 ....................................................................................... 8,272 5,926 0 0 0
225 ....................................................................................... 0 0 2,972 16 0
250 ....................................................................................... 134 508 0 0 0
300 ....................................................................................... 0 0 13,061 268 0
333 ....................................................................................... 4 890 0 0 0
500 ....................................................................................... 3 488 9,867 0 3
667 ....................................................................................... 6 0 13 0 13
750 ....................................................................................... 0 0 6,057 0 49
833 ....................................................................................... 70 21 39 0 39
1,000 .................................................................................... 0 0 5,426 0 127
1,500 .................................................................................... 0 0 5,886 0 150
2,000 .................................................................................... 0 0 2,349 0 103
2,500 .................................................................................... 0 0 3,701 0 359
3,750 .................................................................................... 0 0 286 0 0
5,000 .................................................................................... 0 0 95 0 0
Total .............................................................................. 221,490 796,116 71,838 2,587 843
TABLE IV.14—ESTIMATED LOW-VOLTAGE DRY-TYPE SHIPMENTS FOR 2027 (UNITS)

Capacity Single-phase Three-phase
(kVA)
10 ............................................................................................................................................................................. 3 ........................
15 ............................................................................................................................................................................. 2,792 18,398
25 ............................................................................................................................................................................. 6,215 ........................
30 ............................................................................................................................................................................. ........................ 44,689
37.5 .......................................................................................................................................................................... 3,777 ........................
45 ............................................................................................................................................................................. ........................ 47,106
50 ............................................................................................................................................................................. 5,821 ........................
75 ............................................................................................................................................................................. 3,508 62,205
100 ........................................................................................................................................................................... 2,200 ........................
112.3 ........................................................................................................................................................................ ........................ 27,858
150 ........................................................................................................................................................................... ........................ 22,062
167 ........................................................................................................................................................................... ........................ ........................
225 ........................................................................................................................................................................... ........................ 7,828
250 ........................................................................................................................................................................... 28 ........................

300 ........................................................................................................................................................................... ........................ 4,109
333 ........................................................................................................................................................................... ........................ ........................
500 ........................................................................................................................................................................... ........................ 2,527
667 ........................................................................................................................................................................... ........................ ........................
750 ........................................................................................................................................................................... ........................ 614
833 ........................................................................................................................................................................... ........................ ........................
1,000 ........................................................................................................................................................................ ........................ 17
TABLE IV.14—ESTIMATED LOW-VOLTAGE DRY-TYPE SHIPMENTS FOR 2027 (UNITS)—Continued

Capacity Single-phase Three-phase
(kVA)
1,500 ........................................................................................................................................................................ ........................ 11

2,000 ........................................................................................................................................................................ ........................ ........................
2,500 ........................................................................................................................................................................ ........................ ........................
Total .................................................................................................................................................................. 24,344 237,423
TABLE IV.15—ESTIMATED MEDIUM-VOLTAGE DRY-TYPE SHIPMENTS FOR 2027 (UNITS)

Capacity
(kVA) 20–45 kV BIL 46–95 kV BIL ≥96 kV BIL 20–45 kV BIL 46–95 kV BIL ≥96 kV BIL
10 ............................................................. 250 180 60 0 0 0

15 ............................................................. 250 180 60 5 0 0
25 ............................................................. 60 40 20 0 0 0
30 ............................................................. 0 0 0 10 0 0
38 ............................................................. 60 40 20 0 0 0
45 ............................................................. 0 0 0 10 0 0
50 ............................................................. 30 20 10 0 0 0
75 ............................................................. 30 20 10 4 2 0
100 ........................................................... 12 20 6 0 0 0
113 ........................................................... 0 0 0 30 4 0
150 ........................................................... 0 0 0 35 5 0
167 ........................................................... 7 10 3 0 0 0
225 ........................................................... 0 0 0 29 12 0
250 ........................................................... 15 20 3 0 0 0
300 ........................................................... 15 0 0 91 30 25
333 ........................................................... 12 20 4 0 0 0
500 ........................................................... 0 0 0 177 85 74
667 ........................................................... 0 0 0 0 0 0
750 ........................................................... 0 0 0 72 121 75
833 ........................................................... 0 0 0 0 0 0
1,000 ........................................................ 0 0 0 45 242 194
1,500 ........................................................ 0 0 0 0 363 244
2,000 ........................................................ 0 0 0 0 605 280
2,500 ........................................................ 0 0 0 0 605 394
3,750 ........................................................ 0 0 0 0 12 8
5,000 ........................................................ 0 0 0 0 4 3
Total .................................................. 741 550 196 508 2,074 1,297
1. Equipment Switching requests data that would indicate a ordered units over time in recent years,
trend in these substitutions. DOE further presumably due to increased
In response to the shipments analysis requests data that would help it electrification of consumer and
presented in the August 2021 determine which types of customers are industrial applications. (NEMA, No. 50
Preliminary Analysis TSD, NEMA preforming these substitutions, e.g.,
commented that manufacturers have at pp. 16–17)
industrial customers, invertor owned DOE has limited data available to
had customers avoid liquid-immersed utilities, MUNIs, etc.
entirely and use dry-type designs due to conduct the sensitivity requested by
local purchasing restrictions or policies. 2. Trends in Distribution Transformer NEMA at this time. To do so DOE would
(NEMA, No. 50 at p. 14) Capacity (kVA) require the current average kVA
DOE understands that medium- NEMA commented that as consumer capacity for each of the representative
voltage dry-type distribution demand increases due to migration to units analyzed in the engineering
transformers (MVDT) can be used as all-electric homes and buildings, it analysis, section IV.C.1 of this
replacement for liquid-immersed stands to reason that kVA sizes will document. If DOE were to apply a shift
distribution transformers but DOE has increase over time as infrastructure in growing capacity without input data
always considered it as an edge case due upgrades capacity to serve these from stakeholders, it would have the
to the differences in purchase price, and consumer demands. Likewise, NEMA effect on inflating the energy savings
consumer sensitivity to first costs. DOE commented that investments in estimates. In response to NEMA’s
does not have sufficient data to model renewable energy generation will cause comment DOE requests data to inform a
the substitution of liquid-immersed changes to transformer shipments, unit shift in the capacity distribution to
distribution transformers with MVDT. sizes and selections, and, that DOE larger capacity distribution
DOE requests comment on which should examine non-static capacity transformers. Additionally, DOE
liquid-immersed distribution scenarios, where kVA of units by type requests information on the extent that
transformers capacities are typically increases over time as NEMA members this increasing trend in capacity would
replaced with MVDT. DOE further express growth in average kVA of affect all types of distribution
transformers, or only medium-voltage costs, and NPV of consumer benefits standards cases) for that class. For the
distribution transformers. over the lifetime of distribution standards cases, DOE considers how a
transformers sold from 2027 through given standard would likely affect the
H. National Impact Analysis
2056. market shares of products with
The NIA assesses the national energy DOE evaluates the impacts of new or efficiencies greater than the standard.
savings (‘‘NES’’) and the NPV from a amended standards by comparing a case
national perspective of total consumer DOE uses a model to calculate the
without such standards with standards-
costs and savings that would be energy savings and the national
case projections. The no-new-standards
expected to result from new or amended consumer costs and savings from each
case characterizes energy use and
standards at specific efficiency levels.83 TSL. Interested parties can review
consumer costs for each product class in
(‘‘Consumer’’ in this context refers to the absence of new or amended energy DOE’s analyses by changing various
consumers of the product being conservation standards. For this input quantities within the model. The
regulated.) DOE calculates the NES and projection, DOE considers historical NIA model uses typical values (as
NPV for the potential standard levels trends in efficiency and various forces opposed to probability distributions) as
considered based on projections of that are likely to affect the mix of inputs.
annual product shipments, along with efficiencies over time. DOE compares Table IV.16 summarizes the inputs
the annual energy consumption and the no-new-standards case with and methods DOE used for the NIA
total installed cost data from the energy projections characterizing the market for analysis for the NOPR. Discussion of
use and LCC analyses. For the present each product class if DOE adopted new these inputs and methods follows the
analysis, DOE projected the energy or amended standards at specific energy table. See chapter 10 of the NOPR TSD
savings, operating cost savings, product efficiency levels (i.e., the TSLs or for further details.
TABLE IV.16—SUMMARY OF INPUTS AND METHODS FOR THE NATIONAL IMPACT ANALYSIS
Inputs Method
Shipments ........................................................... Annual shipments from shipments model.

Initial Shipments: Market reports from HVOLT, stakeholder data, confidential manufacturer
data.
Future Shipments: Projection based on trends from AEO2022:
Liquid-immersed: Future electricity sales trends.
Low-, Medium-voltage Dry-type: Future commercial floor space and industrial output trends.
Compliance Date of Standard ............................. 2027.
Efficiency Trends ................................................. No-new-standards case: constant efficiency over time.
Standards cases: constant efficiency over time.
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 do not change with efficiency level.
Energy Price Trends ........................................... AEO2022 projections (to 2050) and constant 2050 thereafter.
Energy Site-to-Primary and FFC Conversion ..... A time-series conversion factor based on AEO2022.
Discount Rate ...................................................... 3 percent and 7 percent.
Present Year ....................................................... 2022.
DOE projected the energy savings, equipment classes for the year of application of constant future
operating cost savings, product costs, anticipated compliance with an equipment costs (see section IV.F.1 of
and NPV of consumer benefits over the amended or new standard. As discussed this document).
lifetime of distribution transformers in section IV.F.3, DOE has found that 2. National Energy Savings
sold from 2027 through 2056 Given the the vast majority of distribution
extremely durable nature of distribution transformers are purchased based on The national energy savings analysis
transformers, this creates an analytical involves a comparison of national
first cost. For both the no-new standards
timeframe from 2027 through 2115. DOE energy consumption of the considered
case and amended standards case, DOE
seeks comment on the current analytical products between each potential
used the results of the consumer choice
timeline, and potential alternative standards case (‘‘TSL’’) and the case
mode in the LCC, described in section with no new or amended energy
analytical timeframes. IV.F.3 to establish the shipment- conservation standards. DOE calculated
1. Equipment Efficiency Trends weighted efficiency for the year of the national energy consumption by
A key component of the NIA is the potential standards are assumed to multiplying the number of units (stock)
trend in energy efficiency projected for become effective (2027). For this NOPR, of each product (by vintage or age) by
the no-new-standards case and each of despite the availability of a wide range the unit energy consumption (also by
the standards cases. Section IV.F.3of of efficiencies, DOE modelled that these vintage). DOE calculated annual NES
this document describes how DOE efficiencies would remain static over based on the difference in national
developed an energy efficiency time because the purchase decision is energy consumption for the no-new
distribution for the no-new-standards largely based on first-costs (see section standards case and for each higher
case for each of the considered IV.F.3 of this document) and DOE’s efficiency standard case. DOE estimated
83 The NIA accounts for impacts in the 50 states
and U.S. territories.
energy consumption and savings based sector 84 that EIA uses to prepare its national-average electricity price
on site energy and converted the Annual Energy Outlook. The FFC factors changes in the Reference case from
electricity consumption and savings to incorporate losses in production and AEO2022, which has an end year of
primary energy (i.e., the energy delivery in the case of natural gas 2050. To estimate price trends after
consumed by power plants to generate (including fugitive emissions) and 2050, DOE maintained the price
site electricity) using annual conversion additional energy used to produce and constant at 2050 levels. As part of the
factors derived from AEO2022. deliver the various fuels used by power NIA, DOE also analyzed scenarios that
Cumulative energy savings are the sum plants. The approach used for deriving used inputs from variants of the
of the NES for each year over the FFC measures of energy use and AEO2022 Reference case that have
timeframe of the analysis. emissions is described in appendix 10B lower and higher economic growth.
Use of higher-efficiency equipment is of the NOPR TSD. Those cases have lower and higher
occasionally associated with a direct energy price trends compared to the
3. Net Present Value Analysis
rebound effect, which refers to an Reference case. NIA results based on
The inputs for determining the NPV these cases are presented in appendix
increase in utilization of the equipment
of the total costs and benefits 10C of the NOPR TSD.
due to the increase in efficiency and its
experienced by consumers are (1) total In calculating the NPV, DOE
lower operating cost. A distribution
annual installed cost, (2) total annual multiplies the net savings in future
transformer’s utilization is entirely
operating costs (energy costs and repair years by a discount factor to determine
dependent on the aggregation of the
and maintenance costs), and (3) a their present value. For this NOPR, DOE
connected loads on the circuit the discount factor to calculate the present estimated the NPV of consumer benefits
distribution transformer serves. Greater value of costs and savings. DOE using both a 3-percent and a 7-percent
utilization would result in greater per- calculates net savings each year as the real discount rate. DOE uses these
unit load (PUL) on the distribution difference between the no-new- discount rates in accordance with
transformer. Any increase in standards case and each standards case guidance provided by the Office of
distribution transformer PUL is in terms of total savings in operating Management and Budget (‘‘OMB’’) to
coincidental, and not related to rebound costs versus total increases in installed Federal agencies on the development of
effect. costs. DOE calculates operating cost regulatory analysis.85 The discount rates
DOE accounts for incidental load savings over the lifetime of each product for the determination of NPV are in
growth on the distribution transformer shipped during the projection period. contrast to the discount rates used in the
resulting from additional connections As discussed in section IV.F.1 of this LCC analysis, which are designed to
not related to the rebound effect due to document, DOE developed distribution reflect a consumer’s perspective. The 7-
increased equipment efficiency.in the transformers price trends based on percent real value is an estimate of the
LCC analysis in the form of future load historical PPI data. DOE applied the average before-tax rate of return to
growth. See section IV.E.3 for more same trends to project prices for each private capital in the U.S. economy. The
details on DOE approach to load growth. product class at each considered 3-percent real value represents the
Because DOE did not find any data to efficiency level, which was a constant ‘‘social rate of time preference,’’ which
support the inclusion of a rebound price trend through the end of the is the rate at which society discounts
effect specific to distribution analysis period in 2056. DOE’s future consumption flows to their
transformers, did not include a rebound projection of product prices is described present value.
effect in this NOPR. in appendix 10C of the NOPR TSD.
To evaluate the effect of uncertainty I. Consumer Subgroup Analysis
DOE requests comment on its
regarding the price trend estimates, DOE In analyzing the potential impact of
assumption that including a rebound
investigated the impact of different new or amended energy conservation
effect is inappropriate for distribution
product price projections on the standards on consumers, DOE evaluates
transformers.
consumer NPV for the considered TSLs the impact on identifiable subgroups of
In 2011, in response to the for distribution transformers. In consumers that may be
recommendations of a committee on addition to the default price trend, DOE disproportionately affected by a new or
‘‘Point-of-Use and Full-Fuel-Cycle considered two product price sensitivity amended national standard. The
Measurement Approaches to Energy cases: (1) a high price decline case based purpose of a subgroup analysis is to
Efficiency Standards’’ appointed by the on the years between 2003–2019 and (2) determine the extent of any such
National Academy of Sciences, DOE a low price decline case based on the disproportional impacts. DOE evaluates
announced its intention to use FFC years between 1967–2002. The impacts on particular subgroups of
measures of energy use and greenhouse derivation of these price trends and the consumers by analyzing the LCC
gas and other emissions in the national results of these sensitivity cases are impacts and PBP for those particular
impact analyses and emissions analyses described in appendix 10C of the NOPR consumers from alternative standard
included in future energy conservation TSD. levels. For this NOPR, DOE analyzed the
standards rulemakings. 76 FR 51281 The operating cost savings are energy impacts of the considered standard
(Aug. 18, 2011). After evaluating the cost savings, which are calculated using levels on two subgroups: (1) utilities
approaches discussed in the August 18, the estimated energy savings in each serving low population densities and (2)
2011 notice, DOE published a statement year and the projected price of the utility purchasers of vault
of amended policy in which DOE appropriate form of energy. To estimate (underground) and subsurface
explained its determination that EIA’s energy prices in future years, DOE installations. DOE used the LCC and
National Energy Modeling System multiplied the average regional energy PBP model to estimate the impacts of
(‘‘NEMS’’) is the most appropriate tool prices by the projection of annual the considered efficiency levels on these
for its FFC analysis and its intention to
use NEMS for that purpose. 77 FR 49701 84 For more information on NEMS, refer to The 85 United States Office of Management and
(Aug. 17, 2012). NEMS is a public National Energy Modeling System: An Overview Budget. Circular A–4: Regulatory Analysis.
2009, DOE/EIA–0581(2009), October 2009. September 17, 2003. Section E. Available at
domain, multi-sector, partial Available at www.eia.gov/forecasts/aeo/index.cfm www.whitehouse.gov/omb/memoranda/m03-
equilibrium model of the U.S. energy (last accessed April 1, 2022). 21.html (last accessed April 1, 2022).
subgroups. Chapter 11 in the NOPR TSD metropolitan areas and may result in governments discussed in IV.F.9. DOE
describes the consumer subgroup lower PULs. For this NOPR, as in the notes that while MUNIs deploy a range
analysis. April 2013 Standards Final Rule, DOE of distribution transformers to serve
reduced the PUL by adjusting the their customers, in low population
1. Utilities Serving Low Customer
distribution of IPLs, as discussed in densities the most common unit is a 25
Populations
section IV.E.1.a resulting in the PULs kVA pole overheard liquid-immersed
In rural areas, mostly served by shown below in Table IV.17. Further, distribution transformer, which is
municipal utilities (MUNIs) the number DOE altered the customer sample to represented in this analysis as
of customers per distribution limit the distribution of discount rates representative unit 2.
transformer is lower than in to those observed by State and local
TABLE IV.17—DISTRIBUTION OF PER-UNIT-LOAD FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS OWNED BY

UTILITIES SERVING LOW POPULATIONS
Rep. unit Mean RMS Mean IPL Mean PUL
1 ................................................................................................................................................... 0.29 0.60 0.18

2 ................................................................................................................................................... 0.27 0.60 0.16
3 ................................................................................................................................................... 0.32 0.60 0.19
4 ................................................................................................................................................... 0.26 0.60 0.15
5 ................................................................................................................................................... 0.31 0.60 0.19
DOE requests comment on the mean specifically defined in the engineering not limited to, excavation and disposal
PUL applied to distribution analysis for vault and submersible of the original vault, and backfilling.
transformers owned and operated by liquid-immersed distribution While stakeholders have discussed that
utilities serving low customer transformers (see section IV.C.1). these costs can be prohibitive, they have
populations. NEMA commented that they agree not to date provided examples of such
with the proposed approach to examine costs, or itemized cost breakdowns
2. Utility Purchasers of Vault
utility costs regarding replacement of associated with vault replacement. Due
(Underground) and Subsurface
existing vault and subsurface to this lack of information DOE has
Installations
transformers. (NEMA No 18 at p. 17). taken a simple approach and multiplied
In some urban areas, utilities provide DOE has not received any data from the costs from RSMeans by three to
service to customers by deploying parts stakeholders regarding the costs provide a gross vault installation
of their transformer fleet in subsurface associated with vault replacement due estimate. This gross vault installation
vaults, or other prefabricated increased distribution transformer estimate represents the labor time and
underground concrete structure, volume. For this subgroups analysis material costs associated with
referred to as vaults. At issue in the DOE examined the National average excavation, vault installation, and
potential amended standards case is that price of concrete vault construction backfilling when replacing the no-new-
as the volume (ft3) of the more efficient with 6-inch-thick walls for variously standards vault with a new structure.
replacement transformers may be too sized vaults from RSMeans.86 DOE notes DOE applied the following simple linear
large to fit into the existing vault, which that the costs required to install a new fit relating the cost of vault replacement
would have to be replaced to fit the new vault can vary above the cost of the to transformer volume.
equipment. This analysis is applied to prefabricated concrete vault. These VaultReplacement = 24.201 ×
the representative units 15 and 16, additional costs would include but are DTVolume + 4,930.8
TABLE IV.18—VAULT REPLACEMENT COSTS

[2021$]
Replacement
Vault dimensions Volume cost
(ft) (ft3) (2021$)
5′ × 10′ × 6′ high ...................................................................................................................................................... 300 12,450

5′ × 12′ × 6′ high ...................................................................................................................................................... 360 13,050
6′ × 10′ × 6′ high ...................................................................................................................................................... 360 13,050
6′ × 12′ × 6′ high ...................................................................................................................................................... 360 14,625
6′ × 13′ × 6′ high ...................................................................................................................................................... 468 18,300
8′ × 14′ × 7′ high ...................................................................................................................................................... 784 23,550
DOE requests comment on its replacement. vault expansion the typical expected lifetime of
assumed vault replacement costs (renovation), and vault transformer underground concrete vaults.
methodology. DOE seeks comment or installation and their respective costs
data regarding the installation for replacement transformers.
procedures associated with vault Additionally, DOE seeks information on
86 RSMeans, Series: 330563130050, 330563130250, 330563130300, https://

330563130150, 330563130100, 330563130200, www.rsmeans.com/ (Last access: March 15, 2022).
J. Manufacturer Impact Analysis DOE conducted the MIA for this DOE discussed engineering,
rulemaking in three phases. In Phase 1 manufacturing, procurement, and
1. Overview
of the MIA, DOE prepared a profile of financial topics to validate assumptions
DOE performed an MIA to estimate the distribution transformer used in the GRIM and to identify key
the financial impacts of amended energy manufacturing industry based on the issues or concerns. See section IV.J.3 of
conservation standards on market and technology assessment, this document for a description of the
manufacturers of distribution preliminary manufacturer interviews, key issues raised by manufacturers
transformers and to estimate the and publicly available information. This during the interviews. As part of Phase
potential impacts of such standards on included a top-down analysis of 3, DOE also evaluated subgroups of
employment and manufacturing distribution transformer manufacturers manufacturers that may be
capacity. The MIA has both quantitative that DOE used to derive preliminary disproportionately impacted by
and qualitative aspects and includes financial inputs for the GRIM (e.g., amended standards or that may not be
analyses of projected industry cash revenues; materials, labor, overhead, accurately represented by the average
flows, the INPV, investments in research and depreciation expenses; selling, cost assumptions used to develop the
and development (‘‘R&D’’) and general, and administrative expenses industry cash flow analysis. Such
manufacturing capital, and domestic (‘‘SG&A’’); and R&D expenses). DOE manufacturer subgroups may include
manufacturing employment. also used public sources of information small business manufacturers, low-
Additionally, the MIA seeks to to further calibrate its initial volume manufacturers (‘‘LVMs’’), niche
determine how amended energy characterization of the distribution players, and/or manufacturers
conservation standards might affect transformer manufacturing industry, exhibiting a cost structure that largely
manufacturing employment, capacity, including information from the April differs from the industry average. DOE
and competition, as well as how 2013 Standards Final Rule, individual identified one subgroup for a separate
standards contribute to overall company filings of form 10–K from the impact analysis: small business
regulatory burden. Finally, the MIA SEC,87 corporate annual reports, the manufacturers. The small business
serves to identify any disproportionate U.S. Census Bureau’s Economic subgroup is discussed in section VI.B,
impacts on manufacturer subgroups, Census,88 and reports from D&B ‘‘Review under the Regulatory
including small business manufacturers. Hoovers.89 Flexibility Act’’ and in chapter 12 of the
The quantitative part of the MIA In Phase 2 of the MIA, DOE prepared NOPR TSD.
primarily relies on the Government a framework industry cash-flow analysis
to quantify the potential impacts of 2. Government Regulatory Impact Model
Regulatory Impact Model (‘‘GRIM’’), an and Key Inputs
amended energy conservation
industry cash flow model with inputs DOE uses the GRIM to quantify the
standards. The GRIM uses several
specific to this rulemaking. The key changes in cash flow due to amended
factors to determine a series of annual
GRIM inputs include data on the standards that result in a higher or
cash flows starting with the
industry cost structure, unit production lower industry value. The GRIM uses a
announcement of the standard and
costs, product shipments, manufacturer standard, annual discounted cash-flow
extending over a 30-year period
markups, and investments in R&D and analysis that incorporates manufacturer
following the compliance date of the
manufacturing capital required to costs, markups, shipments, and industry
standard. These factors include annual
produce compliant equipment. The key financial information as inputs. The
expected revenues, costs of sales, SG&A
GRIM outputs are the INPV, which is GRIM models changes in costs,
and R&D expenses, taxes, and capital
the sum of industry annual cash flows distribution of shipments, investments,
expenditures. In general, energy
over the analysis period, discounted and manufacturer margins that could
conservation standards can affect
using the industry-weighted average result from amended energy
manufacturer cash flow in three distinct
cost of capital, and the impact to conservation standards. The GRIM
ways: (1) creating a need for increased
domestic manufacturing employment. spreadsheet uses the inputs to arrive at
investment, (2) raising production costs
The model uses standard accounting a series of annual cash flows, beginning
per unit, and (3) altering revenue due to
principles to estimate the impacts of in 2022 (the reference year of the
higher per-unit prices and changes in
more-stringent energy conservation analysis) and continuing to 2056. DOE
sales volumes.
standards on a given industry by In addition, during Phase 2, DOE calculated INPVs by summing the
comparing changes in INPV and developed interview guides to distribute stream of annual discounted cash flows
domestic manufacturing employment to manufacturers of distribution during this period. For manufacturers of
between a no-new-standards case and transformers in order to develop other distribution transformers, DOE used a
the various standards cases (i.e., TSLs). key GRIM inputs, including product and real discount rate of 7.4 percent for
To capture the uncertainty relating to capital conversion costs, and to gather liquid-immersed distribution
manufacturer pricing strategies additional information on the transformers, 11.1 percent for low-
following amended standards, the GRIM anticipated effects of energy voltage dry-type distribution
estimates a range of possible impacts conservation standards on revenues, transformers, and 9.0 percent for
under different scenarios. direct employment, capital assets, medium-voltage dry-type distribution
The qualitative part of the MIA industry competitiveness, industry transformers, which was derived from
addresses manufacturer characteristics consolidation, and manufacturer the April 2013 Standards Final Rule and
and market trends. Specifically, the MIA subgroup impacts. then modified according to feedback
considers such factors as a potential
In Phase 3 of the MIA, DOE received during manufacturer

standard’s impact on manufacturing conducted structured, detailed interviews.90
capacity, competition within the interviews with representative
industry, the cumulative impact of other manufacturers. During these interviews, 90 See Chapter 12 of the April 2013 Final Rule
DOE and non-DOE regulations, and TSD for discussion of where initial discount factors
were derived, available online at
impacts on manufacturer subgroups. 87 www.sec.gov/edgar.shtml.
www.regulations.gov/document/EERE-2010-BT-
The complete MIA is outlined in 88 www.census.gov/programs-surveys/asm.html.
STD-0048-0760. For the April 2013 Final Rule, DOE
chapter 12 of the NOPR TSD. 89 www.app.avention.com. initially calculated a 9.1 percent discount rate,
DOE requests comment on the real options (and associated MSPs). This capital conversion costs include
discount rates used in this NOPR. subset is meant to represent those changes in core steel type (and
Specifically, if 7.4 percent for liquid- designs that would actually be shipped thickness), core weight, and core stack
immersed distribution transformer in the market under the various height, all of which are interdependent
manufacturers, 11.1 percent for low- analyzed TSLs. DOE inputted into the and can vary by efficiency level. DOE
voltage dry-type distribution GRIM the weighted average cost of the uses estimates of the core steel
transformer manufacturers, and 9.0 designs selected by the LCC model and quantities needed by steel type for each
percent for medium-voltage dry-type scaled those MSPs to other selected TSL to model the additional equipment
distribution transformer manufacturers capacities in each design line’s KVA the industry would need to meet each
are appropriate discount rates to use in range. TSL.
the GRIM. For a complete description of the Capital conversion costs are primarily
The GRIM calculates cash flows using MSPs, see chapter 5 of the NOPR TSD. driven at each TSL by the potential need
standard accounting principles and for the industry to expand capacity for
b. Shipments Projections
compares changes in INPV between the amorphous production. Based on
no-new-standards case and each The GRIM estimates manufacturer interviews with manufacturers and
standards case. The difference in INPV revenues based on total unit shipment equipment suppliers, based on the
between the no-new-standards case and projections and the distribution of those responses, DOE’s model assumed an
a standards case represents the financial shipments by efficiency level. Changes amorphous production line capable of
impact of amended energy conservation in sales volumes and efficiency mix producing 1,200 tons annual of
standards on manufacturers. As over time can significantly affect amorphous cores would cost
discussed previously, DOE developed manufacturer finances. For this analysis, approximately $1,000,000 in capital
critical GRIM inputs using a number of the GRIM uses the NIA’s annual investments. This includes costs
sources, including publicly available shipment projections derived from the associated with purchasing annealing
data, results of the engineering analysis shipments analysis from 2022 (the ovens, core cutting machines, lacing
and shipments analysis, and reference year) to 2056 (the end year of tables, and other miscellaneous
information gathered from industry the analysis period). See chapter 9 of the equipment. The quantity of amorphous
stakeholders during the course of NOPR TSD for additional details. steel are outputs of the engineering
manufacturer interviews. The GRIM c. Product and Capital Conversion Costs analysis and the LCC. At higher TSLs,
results are presented in section V.B.2. the percent of distribution transformers
Amended energy conservation selected in the LCC consumer choice
Additional details about the GRIM, the
standards could cause manufacturers to model that have amorphous cores
discount rate, and other financial
incur conversion costs to bring their increases. Additionally, at the highest
parameters can be found in chapter 12
production facilities and equipment TSLs, the quantity of amorphous steel
of the NOPR TSD.
designs into compliance. DOE evaluated per distribution transformer also
a. Manufacturer Production Costs the level of conversion-related increases. As the increasing stringency
Manufacturing more efficient expenditures that would be needed to of the TSLs drive the use of amorphous
equipment is typically more expensive comply with each considered efficiency cores in distribution transformers,
than manufacturing baseline equipment level in each equipment class. For the capital conversion costs increase.
due to the use of more complex MIA, DOE classified these conversion For product conversion costs, DOE
components, which are typically more costs into two major groups: (1) product understands the production of
costly than baseline components. The conversion costs; and (2) capital amorphous cores requires unique
changes in the MPCs of covered conversion costs. Product conversion expertise and equipment. For
products can affect the revenues, gross costs are investments in research, manufacturers without experience with
margins, and cash flow of the industry. development, testing, marketing, and amorphous steel, a standard that would
During the engineering analysis, DOE other non-capitalized costs necessary to likely be met using amorphous cores
used transformer design software to make product designs comply with would require the development or the
create a database of designs spanning a amended energy conservation procurement of the technical knowledge
broad range of efficiencies for each of standards. Capital conversion costs are to produce cores. Because amorphous
the representative units. This design investments in property, plant, and steel is thinner and more brittle after
software generated a bill of materials. equipment necessary to adapt or change annealing, materials management, safety
DOE then applied markups to allow for existing production facilities such that measures, and design considerations
scrap, handling, factory overhead, and new compliant equipment designs can that are not associated with non-
other non-production costs, as well as be fabricated and assembled. amorphous steels would need to be
profit, to estimate the MSP. For capital conversion costs, DOE implemented.
These designs and their MSPs are prepared bottom-up estimates of the DOE estimated product conversion
subsequently inputted into the LCC costs required to meet amended costs would be equal to the annual
customer choice model. For each standards at each TSL for each industry R&D expenses for those TSLs
efficiency level and within each representative unit. To do this, DOE where a majority of the market would be
representative unit, the LCC model uses used equipment cost estimates from the expected to transition to amorphous
a consumer choice model and criteria April 2013 Standards Final Rule and material. These one-time product
described in section IV.F.3 to select a from information provided by conversion costs would be in addition
manufacturers and equipment suppliers, to the annual R&D expenses normally
subset of all the potential designs

an understanding of the manufacturing incurred by distribution transformer
however during manufacturer interviews conducted processes at distribution transformer manufacturers. These one-time
for that rulemaking, manufacturers suggested using manufacturing facilities developed expenditures account for the design,
different discount rates specific for each equipment during interviews and in consultation engineering, prototyping, and other R&D
class group. During manufacturer interviews
conducted for this NOPR, manufacturers continued
with subject matter experts, and the efforts the industry would have to
to agree that using different discount rates for each properties associated with different core undertake to move to a predominately
equipment class group is appropriate. and winding materials. Major drivers of amorphous market. For TSLs that would
not require the use of amorphous cores, publicly available financial information Manufacturer interviews are conducted
but would still require distribution for manufacturers of distribution under non-disclosure agreements
transformer models to be redesigned to transformers, and comments made (‘‘NDAs’’), so DOE does not document
meet higher efficiency levels, DOE during manufacturer interviews, DOE these discussions in the same way that
estimated product conversion costs estimated a gross margin percentage of it does public comments in the
would be equal to 50 percent the annual 20 percent for all distribution comment summaries and DOE’s
industry R&D expenses. These one-time transformers.91 Because this scenario responses throughout the rest of this
product conversion costs would also be assumes that manufacturers would be document.
in addition to the annual R&D expenses able to maintain the same gross margin
a. Material Shortages and Prices
normally incurred by distribution percentage as MPCs increase in
transformer manufacturers. response to the analyzed energy Throughout interviews and
Capital and product conversion costs conservation standards, it represents the comments, manufacturers noted
are key inputs into the GRIM and upper bound to industry profitability substantial material shortages leading to
directly impact the change in INPV under amended energy conservation both higher, more volatile prices and, at
(which is outputted from the model) standards. points, an inability to procure certain
due to analyzed amended standards. Under the preservation of operating materials—particularly electrical steel.
The GRIM assumes all conversion- profit scenario, DOE modeled a Manufacturers noted that these
related investments occur between the situation in which manufacturers are shortages reflect rising demand for
year of publication of the final rule and not able to increase per-unit operating electrical steel domestically and
the year by which manufacturers must profit in proportion to increases in internationally as well as more general
comply with the amended standards. MPCs. Under this scenario, as the cost supply chain issues caused by the
The conversion cost figures used in the of production (MPCs) increase, COVID–19 pandemic. Demand for steel,
GRIM can be found in section V.B.2 of manufacturers reduce their according to manufacturers, appears to
this document. For additional manufacturer markups (on a percentage be driven by the growing electric
information on the estimated capital basis) to a level that maintains the no- vehicles and electric motors sectors
and product conversion costs, see new-standards operating profit (in (prompting some steel producers to shift
chapter 12 of the NOPR TSD. absolute dollars). The implicit production away from GOES suited for
assumption behind this scenario is that core manufacturing to non-grain-
d. Manufacturer Markup Scenarios oriented steels suited for electric vehicle
the industry can only maintain its
MSPs include direct manufacturing operating profit in absolute dollars after production) as well as more general
production costs (i.e., labor, materials, compliance with amended standards. rising demand for electrical steel abroad
and overhead estimated in DOE’s MPCs) Therefore, operating margin in (leading to foreign steel producers
and all non-production costs (i.e., percentage terms is reduced between the reducing exports to the United States).
SG&A, R&D, and interest), along with no-new-standards case and the analyzed Manufacturers also noted that prices for
profit. To calculate the MSPs in the standards cases. DOE adjusted the copper and aluminum have risen
GRIM, DOE applied manufacturer manufacturer markups in the GRIM at substantially, though have not been
markups to the MPCs estimated in the each TSL to yield approximately the subject to allocations as electrical steel
engineering analysis for each equipment same earnings before interest and taxes has.
class and efficiency level. Modifying in the standards case in the year after Manufacturers stated that higher
these margins in the standards case the compliance date of the amended energy conservation standards will most
yields different sets of impacts on standards as in the no-new-standards likely lead to greater demand for
manufacturers. For the MIA, DOE materials necessary to build more
case. This scenario represents the lower
modeled two standards-case scenarios efficient transformers—potentially
bound to industry profitability under
to represent uncertainty regarding the leading to less material availability and
amended energy conservation
potential impacts on prices and greater cost concerns, particularly for
standards.
profitability for manufacturers following A comparison of industry financial manufacturers without long-term
the implementation of amended energy impacts under the two scenarios is relationships with suppliers. Further,
conservation standards: (1) a presented in section V.B.2.a of this several manufacturers argued that
preservation of gross margin percentage document. establishing more stringent energy
markup scenario; and (2) a preservation conservation standards during a period
of operating profit scenario. These 3. Manufacturer Interviews of material price volatility may
scenarios lead to different margins that, DOE interviewed manufacturers undermine DOE’s analysis as it relates
when applied to the MPCs, result in representing approximately 60 percent to the short-term and long-term
varying revenue and cash flow impacts of the liquid-immersed distribution economic impact of such a standard.
on distribution transformer transformer industry; approximately 50
manufacturers. b. Use of Amorphous Materials
percent of the LVDT distribution
Under the preservation of gross transformer industry; and Manufacturers raised concerns about
margin percentage scenario, DOE approximately 60 percent of the MVDT energy conservation standards that
applied the same single uniform ‘‘gross distribution transformer industry. would require the use of amorphous
margin percentage’’ that is used in the In interviews, DOE asked steel cores. Manufacturers who
no-new-standards case across all manufacturers to describe their major currently make their own cores stated
efficiency levels in the standards cases. that amorphous core production
concerns regarding this rulemaking. The

This scenario assumes that following section highlights requires a different manufacturing
manufacturers would be able to manufacturer concerns that helped process that would require a substantial
maintain the same amount of profit as inform the projected potential impacts amount of new capital equipment and
a percentage of revenues at all TSLs, of an amended standard on the industry. retrofits of existing equipment that
even as the MPCs increase in the could, additionally, require more
standards case. Based on data from the 91 The gross margin percentage of 20 percent is facility floor space. Some manufacturers
April 2013 Standards Final Rule, based on a manufacturer markup of 1.25. noted that they may need to switch to
purchasing cores for products covered distribution transformer manufacturers processing, and transporting fuels to the
by energy conservation standards. being required to fabricate their own site of combustion.
Moving from a lower to a higher grade cores internally). Schneider continued The analysis of electric power sector
of non-amorphous steel would result in stating that the availability to purchase emissions of CO2, NOX, SO2, and Hg
significantly less costs and most assembled cores would not place a uses emissions factors intended to
manufacturers could continue to use the disproportionate burden on small represent the marginal impacts of the
same core production equipment. businesses. (Schneider, No. 49 at p. 15) change in electricity consumption
Manufacturers that currently purchase DOE agrees that large capital and associated with amended or new
cores noted less capital conversion costs production conversion costs could put standards. The methodology is based on
associated with such an increase in additional strains on all distribution results published for the AEO, including
standards but did note that there is a transformer manufacturers, and a set of side cases that implement a
limited number of suppliers of especially small business. As part of the variety of efficiency-related policies.
amorphous steel grades both in North MIA DOE calculates the expected The methodology is described in
America and globally—potentially conversion costs (capital and product appendix 13A in the NOPR TSD. The
meaning a limited supply of amorphous conversion costs). The methodology for analysis presented in this notice uses
steel in a market with relatively little calculating these conversion costs are projections from AEO2022. Power sector
competition. described in section IV.J.2.c and these emissions of CH4 and N2O from fuel
c. Larger Distribution Transformers cost estimates are presented in section combustion are estimated using
V.B.2.a. Additionally, DOE specifically Emission Factors for Greenhouse Gas
Manufacturers noted that energy Inventories published by the
examines the potential impact of small
conservation standard increases, short Environmental Protection Agency
businesses in section VI.B of this
of requiring amorphous core usage, (EPA).92
document.
would likely lead to larger distribution FFC upstream emissions, which
transformers. Manufacturers stated that As stated in section IV.J.2.c,
conversion costs are primarily driven by include emissions from fuel combustion
larger transformer sizes could during extraction, processing, and
complicate efforts to design the costs associated with the production
of amorphous cores, and to a lesser transportation of fuels, and ‘‘fugitive’’
transformers to replace existing emissions (direct leakage to the
transformers where space is limited. extent larger and more efficient GOES
cores. DOE agrees with Schneider’s atmosphere) of CH4 and CO2, are
Utilities, for example, have built vaults, estimated based on the methodology
where distribution transformers are comment that small businesses could
mitigate larger conversion costs by described in chapter 15 of the NOPR
placed, of a certain size. If a TSD.
replacement distribution transformer purchasing assembled cores as opposed
to making the investments to produce The emissions intensity factors are
cannot be designed to fit the current expressed in terms of physical units per
vault space, then utilities will need to more efficient GOES cores or
amorphous cores, in order to comply MWh or MMBtu of site energy savings.
build new vaults, increasing costs and For power sector emissions, specific
construction-related disruption with the analyzed standards.
emissions intensity factors are
significantly. Manufacturers indicated b. Capital Equipment calculated by sector and end use. Total
that this was not a significant issue with emissions reductions are estimated
new construction projects, where ERMCO comments that larger cores
may require new or different using the energy savings calculated in
infrastructure can be built around the the national impact analysis.
size of the distribution transformer. manufacturing equipment. (ERMCO, No.
45 at p. 1) DOE agrees that while capital 1. Air Quality Regulations Incorporated
4. Discussion of MIA Comments conversion costs are primarily driven by in DOE’s Analysis
In response to the August 2021 the costs associated with the production
of amorphous cores, there are capital DOE’s no-new-standards case for the
Preliminary Analysis TSD, a few electric power sector reflects the AEO,
interested parties made comments conversion costs associated with
production of larger cores. DOE which incorporates the projected
regarding the MIA, including comments impacts of existing air quality
on small businesses and capital accounts for the need for manufacturers
to purchase new or different equipment regulations on emissions. AEO2022
equipment. DOE addresses these generally represents current legislation
comments in this section. in the capital conversion cost estimates
described in section IV.J.2.c, with these and environmental regulations,
a. Small Businesses cost estimates presented in section including recent government actions,
Powersmiths commented that large V.B.2.a of this document. that were in place at the time of
manufacturers are likely to be able to preparation of AEO2022, including the
K. Emissions Analysis emissions control programs discussed in
meet higher efficiency standards given
they will likely have the resources to The emissions analysis consists of the following paragraphs.93
make the necessary capital investments two components. The first component SO2 emissions from affected electric
to comply with standards and would estimates the effect of potential energy generating units (‘‘EGUs’’) are subject to
likely gain additional revenue from the conservation standards on power sector nationwide and regional emissions cap-
higher per transformer prices. However, and site (where applicable) combustion and-trade programs. Title IV of the
if energy conservation standards require emissions of CO2, NOX, SO2, and Hg. Clean Air Act sets an annual emissions
large capital investments, these costs The second component estimates the
92 Available at www.epa.gov/sites/production/
could put small businesses out of impacts of potential standards on files/2021-04/documents/emission-factors_
business. (Powersmiths, No.46 at p. 6) emissions of two additional greenhouse apr2021.pdf (last accessed July 12, 2021).
While Schneider commented that there gases, CH4 and N2O, as well as the 93 For further information, see the Assumptions to
is an increase in the number of reductions to emissions of other gases AEO2022 report that sets forth the major
assumptions used to generate the projections in the
companies that produce assembled due to ‘‘upstream’’ activities in the fuel Annual Energy Outlook. Available at www.eia.gov/
cores for distribution transformer production chain. These upstream outlooks/aeo/assumptions/ (last accessed June,
manufacturers (as opposed to activities comprise extraction, 2022).
cap on SO2 for affected EGUs in the 48 for acid gas. In order to continue N2O, NOX, and SO2 that are expected to
contiguous States and the District of operating, coal power plants must have result from each of the TSLs considered.
Columbia (DC). (42 U.S.C. 7651 et seq.) either flue gas desulfurization or dry In order to make this calculation
SO2 emissions from numerous States in sorbent injection systems installed. Both analogous to the calculation of the NPV
the eastern half of the United States are technologies, which are used to reduce of consumer benefit, DOE considered
also limited under the Cross-State Air acid gas emissions, also reduce SO2 the reduced emissions expected to
Pollution Rule (‘‘CSAPR’’). 76 FR 48208 emissions. Because of the emissions result over the lifetime of products
(Aug. 8, 2011). CSAPR requires these reductions under the MATS, it is shipped in the projection period for
States to reduce certain emissions, unlikely that excess SO2 emissions each TSL. This section summarizes the
including annual SO2 emissions, and allowances resulting from the lower basis for the values used for monetizing
went into effect as of January 1, electricity demand would be needed or the emissions benefits and presents the
2015.94 AEO2022 incorporates used to permit offsetting increases in values considered in this NOPR.
implementation of CSAPR, including SO2 emissions by another regulated On March 16, 2022, the Fifth Circuit
the update to the CSAPR ozone season EGU. Therefore, energy conservation Court of Appeals (No. 22–30087)
program emission budgets and target standards that decrease electricity granted the federal government’s
dates issued in 2016. 81 FR 74504 (Oct. generation would generally reduce SO2 emergency motion for stay pending
26, 2016).95 Compliance with CSAPR is emissions. DOE estimated SO2 appeal of the February 11, 2022,
flexible among EGUs and is enforced emissions reduction using emissions preliminary injunction issued in
through the use of tradable emissions factors based on AEO2022. Louisiana v. Biden, No. 21–cv–1074–
allowances. Under existing EPA CSAPR also established limits on NOX JDC–KK (W.D. La.). As a result of the
regulations, for states subject to SO2 emissions for numerous States in the Fifth Circuit’s order, the preliminary
emissions limits under CSAPR, excess eastern half of the United States. Energy injunction is no longer in effect,
SO2 emissions allowances resulting conservation standards would have pending resolution of the federal
from the lower electricity demand little effect on NOX emissions in those government’s appeal of that injunction
caused by the adoption of an efficiency States covered by CSAPR emissions or a further court order. Among other
standard could be used to permit limits if excess NOX emissions things, the preliminary injunction
offsetting increases in SO2 emissions by allowances resulting from the lower enjoined the defendants in that case
another regulated EGU. electricity demand could be used to from ‘‘adopting, employing, treating as
However, beginning in 2016, SO2 permit offsetting increases in NOX binding, or relying upon’’ the interim
emissions began to fall as a result of the emissions from other EGUs. In such estimates of the social cost of
Mercury and Air Toxics Standards case, NOX emissions would remain near greenhouse gases—which were issued
(‘‘MATS’’) for power plants. 77 FR 9304 the limit even if electricity generation by the Interagency Working Group on
(Feb. 16, 2012). In the MATS final rule, goes down. A different case could the Social Cost of Greenhouse Gases on
EPA established a standard for hydrogen possibly result, depending on the February 26, 2021—to monetize the
chloride as a surrogate for acid gas configuration of the power sector in the benefits of reducing greenhouse gas
hazardous air pollutants (‘‘HAP’’), and different regions and the need for emissions. As reflected in this rule, DOE
also established a standard for SO2 (a allowances, such that NOX emissions has reverted to its approach prior to the
non-HAP acid gas) as an alternative might not remain at the limit in the case injunction and presents monetized
equivalent surrogate standard for acid of lower electricity demand. In this case, greenhouse gas abatement benefits
gas HAP. The same controls are used to energy conservation standards might where appropriate and permissible
reduce HAP and non-HAP acid gas; reduce NOX emissions in covered under law. DOE requests comment on
thus, SO2 emissions are being reduced States. Despite this possibility, DOE has how to address the climate benefits and
as a result of the control technologies chosen to be conservative in its analysis non-monetized effects of the proposal.
installed on coal-fired power plants to and has maintained the assumption that
1. Monetization of Greenhouse Gas
comply with the MATS requirements standards will not reduce NOX
Emissions
emissions in States covered by CSAPR.
94 CSAPR requires states to address annual Energy conservation standards would be For the purpose of complying with
emissions of SO2 and NOX, precursors to the expected to reduce NOX emissions in the requirements of Executive Order
formation of fine particulate matter (PM2.5) 12866, DOE estimates the monetized
pollution, in order to address the interstate
the States not covered by CSAPR. DOE
transport of pollution with respect to the 1997 and used AEO2022 data to derive NOX benefits of the reductions in emissions
2006 PM2.5 National Ambient Air Quality Standards emissions factors for the group of States of CO2, CH4, and N2O by using a
(‘‘NAAQS’’). CSAPR also requires certain states to not covered by CSAPR. measure of the social cost (‘‘SC’’) of each
address the ozone season (May–September) The MATS limit mercury emissions pollutant (e.g., SC–GHGs). These
emissions of NOX, a precursor to the formation of estimates represent the monetary value
ozone pollution, in order to address the interstate from power plants, but they do not
transport of ozone pollution with respect to the include emissions caps and, as such, of the net harm to society associated
1997 ozone NAAQS. 76 FR 48208 (Aug. 8, 2011). DOE’s energy conservation standards with a marginal increase in emissions of
EPA subsequently issued a supplemental rule that would be expected to slightly reduce Hg these pollutants in a given year, or the
included an additional five states in the CSAPR benefit of avoiding that increase. These
ozone season program; 76 FR 80760 (Dec. 27, 2011) emissions. DOE estimated mercury
(Supplemental Rule), and EPA issued the CSAPR emissions reduction using emissions estimates are intended to include (but
Update for the 2008 ozone NAAQS. 81 FR 74504 factors based on AEO2022, which are not limited to) climate-change-
(Oct. 26, 2016). incorporates the MATS. related changes in net agricultural
95 In Sept. 2019, the D.C. Court of Appeals
productivity, human health, property
remanded the 2016 CSAPR Update to EPA. In April L. Monetizing Emissions Impacts damages from increased flood risk,
2021, EPA finalized the 2021 CSAPR Update which
resolved the interstate transport obligations of 21 As part of the development of this disruption of energy systems, risk of
states for the 2008 ozone NAAQS. 86 FR 23054 proposed rule, for the purpose of conflict, environmental migration, and
(April 30, 2021); see also, 86 FR 29948 (June 4, complying with the requirements of the value of ecosystem services. DOE
2021) (correction to preamble). The 2021 CSAPR
Update became effective on June 29, 2021. The
Executive Order 12866, DOE considered exercises its own judgment in
release of AEO 2021 in February 2021 predated the the estimated monetary benefits from presenting monetized climate benefits
2021 CSAPR Update. the reduced emissions of CO2, CH4, as recommended by applicable
Executive orders and guidance, and economy combined into a single methodological decisions and model
DOE would reach the same conclusion modeling framework. The three IAMs versions used in SC–GHG calculations
presented in this proposed rulemaking were run using a common set of input remained the same as those used by the
in the absence of the social cost of assumptions in each model for future IWG in 2010 and 2013, respectively.
greenhouse gases, including the population, economic, and CO2 On January 20, 2021, President Biden
February 2021 Interim Estimates emissions growth, as well as issued Executive Order 13990, which re-
presented by the Interagency Working equilibrium climate sensitivity (ECS)—a established the IWG and directed it to
Group on the Social Cost of Greenhouse measure of the globally averaged ensure that the U.S. Government’s
Gases. temperature response to increased estimates of the social cost of carbon
DOE estimated the global social atmospheric CO2 concentrations. These and other greenhouse gases reflect the
benefits of CO2, CH4, and N2O estimates were updated in 2013 based best available science and the
reductions (i.e., SC–GHGs) using the on new versions of each IAM. In August recommendations of the National
estimates presented in the Technical 2016 the IWG published estimates of the Academies (2017). The IWG was tasked
Support Document: Social Cost of social cost of methane (SC–CH4) and with first reviewing the SC–GHG
Carbon, Methane, and Nitrous Oxide nitrous oxide (SC–N2O) using estimates currently used in Federal
Interim Estimates under Executive methodologies that are consistent with analyses and publishing interim
Order 13990 published in February the methodology underlying the SC– estimates within 30 days of the E.O. that
2021 by the Interagency Working Group CO2 estimates. The modeling approach reflect the full impact of GHG
on the Social Cost of Greenhouse Gases that extends the IWG SC–CO2 emissions, including by taking global
(IWG) (IWG, 2021). The SC–GHGs is the damages into account. The interim SC–
methodology to non-CO2 GHGs has
monetary value of the net harm to GHG estimates published in February
undergone multiple stages of peer
society associated with a marginal 2021 are used here to estimate the
review. The SC–CH4 and SC–N2O
increase in emissions in a given year, or climate benefits for this proposed
estimates were developed by Marten et
the benefit of avoiding that increase. In rulemaking. The E.O. instructs the IWG
al. (2015) and underwent a standard
principle, SC–GHGs includes the value to undertake a fuller update of the SC–
double-blind peer review process prior
of all climate change impacts, including GHG estimates by January 2022 that
to journal publication. In 2015, as part
(but not limited to) changes in net takes into consideration the advice of
of the response to public comments
agricultural productivity, human health the National Academies (2017) and
received to a 2013 solicitation for other recent scientific literature. The
effects, property damage from increased
flood risk and natural disasters, comments on the SC–CO2 estimates, the February 2021 SC–GHG TSD provides a
disruption of energy systems, risk of IWG announced a National Academies complete discussion of the IWG’s initial
conflict, environmental migration, and of Sciences, Engineering, and Medicine review conducted under E.O. 13990. In
the value of ecosystem services. The review of the SC–CO2 estimates to offer particular, the IWG found that the SC–
SC–GHGs therefore, reflects the societal advice on how to approach future GHG estimates used under E.O. 13783
value of reducing emissions of the gas updates to ensure that the estimates fail to reflect the full impact of GHG
in question by one metric ton. The SC– continue to reflect the best available emissions in multiple ways.
GHGs is the theoretically appropriate science and methodologies. In January First, the IWG found that the SC–GHG
value to use in conducting benefit-cost 2017, the National Academies released estimates used under E.O. 13783 fail to
analyses of policies that affect CO2, N2O their final report, Valuing Climate fully capture many climate impacts that
and CH4 emissions. As a member of the Damages: Updating Estimation of the affect the welfare of U.S. citizens and
IWG involved in the development of the Social Cost of Carbon Dioxide, and residents, and those impacts are better
February 2021 SC–GHG TSD), the DOE recommended specific criteria for future reflected by global measures of the SC–
agrees that the interim SC–GHG updates to the SC–CO2 estimates, a GHG. Examples of effects omitted from
estimates represent the most appropriate modeling framework to satisfy the the E.O. 13783 estimates include direct
estimate of the SC–GHG until revised specified criteria, and both near-term effects on U.S. citizens, assets, and
estimates have been developed updates and longer-term research needs investments located abroad, supply
reflecting the latest, peer-reviewed pertaining to various components of the chains, U.S. military assets and interests
science. estimation process (National abroad, and tourism, and spillover
The SC–GHGs estimates presented Academies, 2017). Shortly thereafter, in pathways such as economic and
here were developed over many years, March 2017, President Trump issued political destabilization and global
using transparent process, peer- Executive Order 13783, which migration that can lead to adverse
reviewed methodologies, the best disbanded the IWG, withdrew the impacts on U.S. national security,
science available at the time of that previous TSDs, and directed agencies to public health, and humanitarian
process, and with input from the public. ensure SC–CO2 estimates used in concerns. In addition, assessing the
Specifically, in 2009, an interagency regulatory analyses are consistent with benefits of U.S. GHG mitigation
working group (IWG) that included the the guidance contained in OMB’s activities requires consideration of how
DOE and other executive branch Circular A–4, ‘‘including with respect to those actions may affect mitigation
agencies and offices was established to the consideration of domestic versus activities by other countries, as those
ensure that agencies were using the best international impacts and the international mitigation actions will
available science and to promote consideration of appropriate discount provide a benefit to U.S. citizens and
consistency in the social cost of carbon rates’’ (E.O. 13783, Section 5(c)). residents by mitigating climate impacts
Benefit-cost analyses following E.O.
(SC–CO2) values used across agencies. that affect U.S. citizens and residents. A
The IWG published SC–CO2 estimates 13783 used SC–GHG estimates that wide range of scientific and economic
in 2010 that were developed from an attempted to focus on the U.S.-specific experts have emphasized the issue of
ensemble of three widely cited share of climate change damages as reciprocity as support for considering
integrated assessment models (IAMs) estimated by the models and were global damages of GHG emissions. If the
that estimate global climate damages calculated using two discount rates United States does not consider impacts
using highly aggregated representations recommended by Circular A–4, 3 on other countries, it is difficult to
of climate processes and the global percent and 7 percent. All other convince other countries to consider the
impacts of their emissions on the United Circular A–4’s guidance for regulatory interim estimates to be the most recent
States. The only way to achieve an analysis would then use the estimates developed by the IWG prior to
efficient allocation of resources for consumption discount rate to calculate the group being disbanded in 2017. The
emissions reduction on a global basis— the SC–GHG. DOE agrees with this estimates rely on the same models and
and so benefit the U.S. and its citizens— assessment and will continue to follow harmonized inputs and are calculated
is for all countries to base their policies developments in the literature using a range of discount rates. As
on global estimates of damages. As a pertaining to this issue. DOE also notes explained in the February 2021 SC–
member of the IWG involved in the that while OMB Circular A–4, as GHG TSD, the IWG has recommended
development of the February 2021 SC– published in 2003, recommends using that agencies to revert to the same set of
GHG TSD, DOE agrees with this 3% and 7% discount rates as ‘‘default’’ four values drawn from the SC–GHG
assessment and, therefore, in this values, Circular A–4 also reminds distributions based on three discount
proposed rule DOE centers attention on agencies that ‘‘different regulations may rates as were used in regulatory analyses
a global measure of SC–GHG. This call for different emphases in the between 2010 and 2016 and subject to
approach is the same as that taken in analysis, depending on the nature and public comment. For each discount rate,
DOE regulatory analyses from 2012 complexity of the regulatory issues and the IWG combined the distributions
through 2016. A robust estimate of the sensitivity of the benefit and cost across models and socioeconomic
climate damages that accrue only to U.S. estimates to the key assumptions.’’ On emissions scenarios (applying equal
citizens and residents does not currently discounting, Circular A–4 recognizes weight to each) and then selected a set
exist in the literature. As explained in that ‘‘special ethical considerations arise of four values recommended for use in
the February 2021 TSD, existing when comparing benefits and costs benefit-cost analyses: an average value
estimates are both incomplete and an across generations,’’ and Circular A–4 resulting from the model runs for each
underestimate of total damages that acknowledges that analyses may of three discount rates (2.5 percent, 3
accrue only to the citizens and residents appropriately ‘‘discount future costs and percent, and 5 percent), plus a fourth
of the U.S. because they do not fully consumption benefits . . . at a lower value, selected as the 95th percentile of
capture the regional interactions and rate than for intragenerational analysis.’’ estimates based on a 3 percent discount
spillovers discussed above, nor do they In the 2015 Response to Comments on rate. The fourth value was included to
include all of the important physical, the Social Cost of Carbon for Regulatory provide information on potentially
ecological, and economic impacts of Impact Analysis, OMB, DOE, and the higher-than-expected economic impacts
climate change recognized in the other IWG members recognized that from climate change. As explained in
climate change literature. As noted in ‘‘Circular A–4 is a living document’’ and the February 2021 SC–GHG TSD, and
the February 2021 SC–GHG TSD, the ‘‘the use of 7 percent is not considered DOE agrees, this update reflects the
IWG will continue to review appropriate for intergenerational immediate need to have an operational
developments in the literature, discounting. There is wide support for SC–GHG for use in regulatory benefit-
including more robust methodologies this view in the academic literature, and cost analyses and other applications that
for estimating a U.S.-specific SC–GHG it is recognized in Circular A–4 itself.’’ was developed using a transparent
value, and explore ways to better inform Thus, DOE concludes that a 7% process, peer-reviewed methodologies,
the public of the full range of carbon discount rate is not appropriate to apply and the science available at the time of
impacts. As a member of the IWG, DOE to value the social cost of greenhouse that process. Those estimates were
will continue to follow developments in gases in the analysis presented in this subject to public comment in the
the literature pertaining to this issue. analysis. In this analysis, to calculate context of dozens of proposed
Second, the IWG found that the use of
the present and annualized values of rulemakings as well as in a dedicated
the social rate of return on capital (7
climate benefits, DOE uses the same public comment period in 2013.
percent under current OMB Circular A–
discount rate as the rate used to There are a number of limitations and
4 guidance) to discount the future
discount the value of damages from uncertainties associated with the SC–
benefits of reducing GHG emissions
future GHG emissions, for internal GHG estimates. First, the current
inappropriately underestimates the
consistency. That approach to scientific and economic understanding
impacts of climate change for the
discounting follows the same approach of discounting approaches suggests
purposes of estimating the SC–GHG.
that the February 2021 TSD discount rates appropriate for
Consistent with the findings of the
National Academies (2017) and the recommends ‘‘to ensure internal intergenerational analysis in the context
economic literature, the IWG continued consistency—i.e., future damages from of climate change are likely to be less
to conclude that the consumption rate of climate change using the SC–GHG at 2.5 than 3 percent, near 2 percent or lower.
interest is the theoretically appropriate percent should be discounted to the Second, the IAMs used to produce these
discount rate in an intergenerational base year of the analysis using the same interim estimates do not include all of
context (IWG 2010, 2013, 2016a, 2016b), 2.5 percent rate.’’ DOE has also the important physical, ecological, and
and recommended that discount rate consulted the National Academies’ 2017 economic impacts of climate change
uncertainty and relevant aspects of recommendations on how SC–GHG recognized in the climate change
intergenerational ethical considerations estimates can ‘‘be combined in RIAs literature and the science underlying
be accounted for in selecting future with other cost and benefits estimates their ‘‘damage functions’’—i.e., the core
discount rates. As a member of the IWG that may use different discount rates.’’ parts of the IAMs that map global mean
involved in the development of the The National Academies reviewed temperature changes and other physical
‘‘several options,’’ including impacts of climate change into
February 2021 SC–GHG TSD, DOE

agrees with this assessment and will ‘‘presenting all discount rate economic (both market and nonmarket)
continue to follow developments in the combinations of other costs and benefits damages—lags behind the most recent
literature pertaining to this issue. with [SC–GHG] estimates.’’ research. For example, limitations
Furthermore, the damage estimates While the IWG works to assess how include the incomplete treatment of
developed for use in the SC–GHG are best to incorporate the latest, peer catastrophic and non-catastrophic
estimated in consumption-equivalent reviewed science to develop an updated impacts in the integrated assessment
terms, and so an application of OMB set of SC–GHG estimates, it set the models, their incomplete treatment of
adaptation and technological change, direction in terms of their influence on a. Social Cost of Carbon
the incomplete way in which inter- the SC–CO2 estimates. However, as
regional and intersectoral linkages are discussed in the February 2021 TSD, the The SC–CO2 values used for this
modeled, uncertainty in the IWG has recommended that, taken NOPR were generated using the values
extrapolation of damages to high together, the limitations suggest that the presented in the 2021 update from the
interim SC–GHG estimates used in this IWG’s February 2021 TSD. Table IV.19
temperatures, and inadequate
final rule likely underestimate the shows the updated sets of SC–CO2
representation of the relationship
damages from GHG emissions. DOE estimates from the latest interagency
between the discount rate and
concurs with this assessment. update in 5-year increments from 2020
uncertainty in economic growth over
DOE’s derivations of the SC–GHG to 2050. The full set of annual values
long time horizons. Likewise, the used is presented in Appendix 14A of
(i.e., SC–CO2, SC–N2O, and SC–CH4)
socioeconomic and emissions scenarios values used for this NOPR are discussed the NOPR TSD. For purposes of
used as inputs to the models do not in the following sections, and the results capturing the uncertainties involved in
reflect new information from the last of DOE’s analyses estimating the regulatory impact analysis, DOE has
decade of scenario generation or the full benefits of the reductions in emissions determined it is appropriate to include
range of projections. The modeling of these pollutants are presented in all four sets of SC–CO2 values, as
limitations do not all work in the same section V.B.6 of this document. recommended by the IWG.96
TABLE IV.19—ANNUAL SC–CO2 VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2070

[2020$ per metric ton CO2]
Discount rate and statistics
3%, 95th
Emissions year 5%, average 3%, average 2.5%, average percentile
2020 ................................................................................................................. 14 51 76 151

2025 ................................................................................................................. 17 56 83 169
2030 ................................................................................................................. 19 62 89 186
2035 ................................................................................................................. 22 67 96 205
2040 ................................................................................................................. 25 73 103 224
2045 ................................................................................................................. 28 79 109 242
2050 ................................................................................................................. 32 84 116 259
2055 ................................................................................................................. 35 89 122 265
2060 ................................................................................................................. 38 93 128 275
2065 ................................................................................................................. 44 100 135 300
2070 ................................................................................................................. 49 108 143 326
The SC–CO2 values used for this beyond 2070 becomes available prior to values presented in the February 2021
NOPR were based on the values the publication of the final rule, DOE TSD. Table IV.20 shows the updated
presented in the 2021 update from the will include that analysis in the final sets of SC–CH4 and SC–N2O estimates
IWG’s February 2021 SC–GHG TSD. For rule. DOE multiplied the CO2 emissions from the latest interagency update in 5-
2051 to 2070, DOE used estimates reduction estimated for each year by the year increments from 2020 to 2050. The
published by EPA, adjusted to 2021$.97 SC–CO2 value for that year in each of full set of annual values used is
These estimates are based on methods, the four cases. To calculate a present presented in Appendix 14A of the
assumptions, and parameters identical value of the stream of monetary values, NOPR TSD. To capture the uncertainties
to the 2020–2050 estimates published DOE discounted the values in each of involved in regulatory impact analysis,
by the IWG. DOE expects additional the four cases using the specific DOE has determined it is appropriate to
climate benefits to accrue for any discount rate that had been used to include all four sets of SC–CH4 and SC–
longer-life transformers post 2070, but a obtain the SC–CO2 values in each case.
lack of available SC–CO2 estimates for N2O values, as recommended by the
emissions years beyond 2070 prevents b. Social Cost of Methane and Nitrous IWG.
DOE from monetizing these potential Oxide
benefits in this analysis. If further The SC–CH4 and SC–N2O values used
analysis of monetized climate benefits for this NOPR were generated using the
TABLE IV.20—ANNUAL SC–CH4 AND SC–N2O VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2070
[2020$ per metric ton]
SC–CH4—discount rate and statistic SC–N2O—discount rate and statistic

Year 5% 3% 2.5% 3% 5% 3% 2.5% 3%
Average Average Average 95th percentile Average Average Average 95th percentile
2020 ......................... 663 I 1,480 I 1,946 I 3,893 5,760 I 18,342 I 27,037 48,090
96 For example, the February 2021 TSD discusses intergenerational analysis in the context of climate Regulatory Impact Analysis, Washington, DC,
how the understanding of discounting approaches change may be lower than 3 percent. December 2021. Available at: www.epa.gov/system/
suggests that discount rates appropriate for 97 See EPA, Revised 2023 and Later Model Year files/documents/2021-12/420r21028.pdf (last
Light-Duty Vehicle GHG Emissions Standards: accessed January 13, 2022).
TABLE IV.20—ANNUAL SC–CH4 AND SC–N2O VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2070—Continued
[2020$ per metric ton]
SC–CH4—discount rate and statistic SC–N2O—discount rate and statistic
Year 5% 3% 2.5% 3% 5% 3% 2.5% 3%
Average Average Average 95th percentile Average Average Average 95th percentile
2025 ......................... 799 1,714 2,223 4,533 6,766 20,520 29,811 54,108
2030 ......................... 935 1,948 2,499 5,173 7,772 22,698 32,585 60,125
2035 ......................... 1,106 2,224 2,817 5,939 9,007 25,149 35,632 66,898
2040 ......................... 1,277 2,500 3,136 6,705 10,241 27,600 38,678 73,670
2045 ......................... 1,464 2,778 3,450 7,426 11,687 30,238 41,888 80,766
2050 ......................... 1,651 3,057 3,763 8,147 13,133 32,875 45,098 87,863
2055 ......................... 1,772 3,221 3,942 8,332 14,758 35,539 48,236 94,117
2060 ......................... 1,899 3,395 4,130 8,539 16,424 38,300 51,507 100,845
2065 ......................... 2,508 4,163 4,960 11,177 19,687 42,625 56,397 115,590
2070 ......................... 3,130 4,976 5,867 14,079 23,018 47,072 61,428 130,928
DOE multiplied the CH4 and N2O energy conservation standards. The investment caused by the purchase and
emissions reduction estimated for each utility impact analysis estimates the operation of more-efficient appliances.
year by the SC–CH4 and SC–N2O changes in installed electrical capacity Indirect employment impacts from
estimates for that year in each of the and generation that would result for standards consist of the net jobs created
cases. To calculate a present value of the each TSL. The analysis is based on or eliminated in the national economy,
stream of monetary values, DOE published output from the NEMS other than in the manufacturing sector
discounted the values in each of the associated with AEO2022. NEMS being regulated, caused by (1) reduced
cases using the specific discount rate produces the AEO Reference case, as spending by consumers on energy, (2)
that had been used to obtain the SC–CH4 well as a number of side cases that reduced spending on new energy supply
and SC–N2O estimates in each case. estimate the economy-wide impacts of by the utility industry, (3) increased
2. Monetization of Other Emissions changes to energy supply and demand. consumer spending on the products to
Impacts For the current analysis, impacts are which the new standards apply and
quantified by comparing the levels of other goods and services, and (4) the
For the NOPR, DOE estimated the electricity sector generation, installed effects of those three factors throughout
monetized value of NOX and SO2 capacity, fuel consumption and the economy.
emissions reductions from electricity emissions in the AEO2022 Reference One method for assessing the possible
generation using the latest benefit per case and various side cases. Details of effects on the demand for labor of such
ton estimates for that sector from the the methodology are provided in the shifts in economic activity is to compare
EPA’s Benefits Mapping and Analysis appendices to chapters 13 and 15 of the sector employment statistics developed
Program.98 DOE used EPA’s values for NOPR TSD. by the Labor Department’s Bureau of
PM2.5-related benefits associated with The output of this analysis is a set of Labor Statistics (‘‘BLS’’). BLS regularly
NOX and SO2 and for ozone-related time-dependent coefficients that capture publishes its estimates of the number of
benefits associated with NOX for 2025 the change in electricity generation, jobs per million dollars of economic
2030, and 2040, calculated with primary fuel consumption, installed activity in different sectors of the
discount rates of 3 percent and 7 capacity and power sector emissions economy, as well as the jobs created
percent. DOE used linear interpolation due to a unit reduction in demand for elsewhere in the economy by this same
to define values for the years not given a given end use. These coefficients are economic activity. Data from BLS
in the 2025 to 2040 period; for years multiplied by the stream of electricity indicate that expenditures in the utility
beyond 2040 the values are held savings calculated in the NIA to provide sector generally create fewer jobs (both
constant. DOE derived values specific to estimates of selected utility impacts of directly and indirectly) than
the sector for distribution transformer potential new or amended energy expenditures in other sectors of the
using a method described in appendix conservation standards. economy.99 There are many reasons for
14B of the NOPR TSD. these differences, including wage
DOE multiplied the site emissions N. Employment Impact Analysis
differences and the fact that the utility
reduction (in tons) in each year by the DOE considers employment impacts sector is more capital-intensive and less
associated $/ton values, and then in the domestic economy as one factor labor-intensive than other sectors.
discounted each series using discount in selecting a proposed standard. Energy conservation standards have the
rates of 3 percent and 7 percent as Employment impacts from new or effect of reducing consumer utility bills.
appropriate. amended energy conservation standards Because reduced consumer
M. Utility Impact Analysis include both direct and indirect expenditures for energy likely lead to
impacts. Direct employment impacts are increased expenditures in other sectors
The utility impact analysis estimates any changes in the number of
several effects on the electric power of the economy, the general effect of
employees of manufacturers of the
generation industry that would result products subject to standards, their 99 See U.S. Department of Commerce–Bureau of
from the adoption of new or amended suppliers, and related service firms. The Economic Analysis. Regional Multipliers: A User
MIA addresses those impacts. Indirect Handbook for the Regional Input-Output Modeling
98 Estimating the Benefit per Ton of Reducing System (RIMS II). 1997. U.S. Government Printing
PM2.5 Precursors from 21 Sectors. www.epa.gov/
employment impacts are changes in Office: Washington, DC. Available at apps.bea.gov/
benmap/estimating-benefit-ton-reducing-pm25- national employment that occur due to scb/pdf/regional/perinc/meth/rims2.pdf (last
precursors-21-sectors. the shift in expenditures and capital accessed June 1, 2022).
efficiency standards is to shift economic proposing to adopt in this NOPR. efficiency levels that DOE analyzed are
activity from a less labor-intensive Additional details regarding DOE’s in the NOPR TSD.
sector (i.e., the utility sector) to more analyses are contained in the NOPR Table V.1 presents the TSLs and the
labor-intensive sectors (e.g., the retail TSD supporting this document. corresponding efficiency levels that
and service sectors). Thus, the BLS data DOE has identified for potential
A. Trial Standard Levels
suggest that net national employment amended energy conservation standards
may increase due to shifts in economic In general, DOE typically evaluates for distribution transformers. TSL 5
activity resulting from energy potential amended standards for represents the maximum
conservation standards. products and equipment by grouping technologically feasible (‘‘max-tech’’)
DOE estimated indirect national individual efficiency levels for each energy efficiency for all product classes.
employment impacts for the standard class into TSLs. Use of TSLs allows DOE TSL 4 represents a loss reduction over
levels considered in this NOPR using an to identify and consider manufacturer baseline of 20 percent for liquid-
input/output model of the U.S. economy cost interactions between the equipment immersed transformers, except
called Impact of Sector Energy classes, to the extent that there are such submersible liquid-immersed
Technologies version 4 (‘‘ImSET’’).100 interactions, and market cross elasticity transformers which remain at baseline;
ImSET is a special-purpose version of from consumer purchasing decisions a 40 and 30 percent reduction in
the ‘‘U.S. Benchmark National Input- that may change when different baseline losses for single-, and three-
Output’’ (‘‘I–O’’) model, which was standard levels are set. DOE presents the phase low-voltage distribution
designed to estimate the national results for the TSLs in this document, transformers, respectively; and a 30
employment and income effects of while the results for all efficiency levels percent reduction in baseline losses for
energy-saving technologies. The ImSET that DOE analyzed are in the NOPR all medium-voltage dry-type
software includes a computer-based I–O TSD. distribution transformers. TSL 3
model having structural coefficients that
characterize economic flows among 187 In the analysis conducted for this represents a loss reduction over baseline
sectors most relevant to industrial, NOPR, DOE analyzed the benefits and of 10 percent for liquid-immersed
commercial, and residential building burdens of five TSLs for distribution transformers, except submersible liquid-
energy use. transformers. DOE developed TSLs that immersed transformers which remain at
DOE notes that ImSET is not a general combine efficiency levels for each baseline; a 30 and 20 percent reduction
equilibrium forecasting model, and that analyzed representative unit and their in baseline losses for single-, and three-
the uncertainties involved in projecting respective equipment classes. For this phase low-voltage distribution
employment impacts, especially NOPR, DOE defined its efficiency levels transformers, respectively; and a 20
changes in the later years of the as a percentage reduction in baseline percent reduction in baseline losses for
analysis. Because ImSET does not losses (see section IV.F.2). To create all medium-voltage dry-type
incorporate price changes, the TSLs, DOE maintained this approach distribution transformers. TSL 2
employment effects predicted by ImSET and directly mapped ELs to TSLs, with represents a loss reduction over baseline
may over-estimate actual job impacts the exception of liquid-immersed of 5 percent for liquid-immersed
over the long run for this rule. submersible distribution transformers transformers, except submersible liquid-
Therefore, DOE used ImSET only to which remain at baseline for all TSLs immersed transformers which remain at
generate results for near-term except max-tech. For submersible baseline; a 20 and 10 percent reduction
timeframes (2031), where these distribution transformers, being able to in baseline losses for single-, and three-
uncertainties are reduced. For more fit in an existing vault is a consumer phase low-voltage distribution
details on the employment impact feature of significant utility and these transformers, respectively; and a 10
analysis, see chapter 16 of the NOPR transformers often serve high density percent reduction in baseline losses for
TSD. applications. DOE recognizes that all medium-voltage dry-type
beyond some size increase a vault distribution transformers. TSL 1
V. Analytical Results and Conclusions replacement may be necessary, represents a loss reduction over baseline
The following section addresses the however, DOE lacks sufficient data as to of 2.5 percent for liquid-immersed
results from DOE’s analyses with where exactly that vault replacement is transformers, except submersible liquid-
respect to the considered energy needed. In order to maintain the immersed transformers which remain at
conservation standards for distribution consumer utility associated with baseline; a 10 and 5 percent reduction
transformers. It addresses the TSLs submersible transformers, DOE has in baseline losses for single-, and three-
examined by DOE, the projected taken the conservative approach of not phase low-voltage distribution
impacts of each of these levels if considering TSLs for submersible transformers, respectively; and a 5
adopted as energy conservation transformers aside from max-tech. DOE percent reduction in baseline losses for
standards for distribution transformers, presents the results for the TSLs in this all medium-voltage dry-type
and the standards levels that DOE is document, while the results for all distribution transformers.
TABLE V.1—EFFICIENCY LEVEL TO TRIAL STANDARD LEVEL MAPPING FOR DISTRIBUTION TRANSFORMERS
Trial standard level
Equipment type EC RU Phases BIL
1 2 3 4 5
Liquid-immersed ................ 1 1 1 All ...................................... 1 2 3 4 5

1 2 1 All ...................................... 1 2 3 4 5
1 3 1 All ...................................... 1 2 3 4 5
2 4 3 All ...................................... 1 2 3 4 5
100 Livingston, O.V., S.R. Bender, M.J. Scott, and Technologies Model Description and User Guide. 2015. Pacific Northwest National Laboratory:
R.W. Schultz. ImSET 4.0: Impact of Sector Energy Richland, WA. PNNL–24563.
TABLE V.1—EFFICIENCY LEVEL TO TRIAL STANDARD LEVEL MAPPING FOR DISTRIBUTION TRANSFORMERS—Continued
Equipment type EC RU Phases BIL
1 2 3 4 5
2 5 3 All ...................................... 1 2 3 4 5
2 17 3 All ...................................... 1 2 3 4 5
12 15 3 All ...................................... 0 0 0 0 5
12 16 3 All ...................................... 0 0 0 0 5
Low-voltage Dry-type ........ 3 6 1 All ...................................... 1 2 3 4 5
4 7 3 All ...................................... 1 2 3 4 5
4 8 3 All ...................................... 1 2 3 4 5
Medium-voltage Dry-type .. 5 * 9V 1 <46 kV .............................. 1 2 3 4 5
5 10V 1 <46 kV .............................. 1 2 3 4 5
6 9 3 <46 kV .............................. 1 2 3 4 5
6 10 3 <46 kV .............................. 1 2 3 4 5
7 11V 1 ≥46 and <96 kV ................ 1 2 3 4 5
7 12V 1 ≥46 and <96 kV ................ 1 2 3 4 5
8 11 3 ≥46 and <96 kV ................ 1 2 3 4 5
8 12 3 ≥46 and <96 kV ................ 1 2 3 4 5
8 18 3 ≥46 and <96 kV ................ 1 2 3 4 5
9 13V 1 ≥96 kV .............................. 1 2 3 4 5
9 14V 1 ≥96 kV .............................. 1 2 3 4 5
10 13 3 ≥96 kV .............................. 1 2 3 4 5
10 14 3 ≥96 kV .............................. 1 2 3 4 5
10 19 3 ≥96 kV .............................. 1 2 3 4 5
DOE constructed the TSLs for this by looking at the effects that potential and a discount rate. Because some
NOPR to include ELs representative of amended standards at each TSL would consumers purchase products with
ELs with similar characteristics (i.e., have on the LCC and PBP. DOE also higher efficiency in the no-new-
using similar technologies and/or examined the impacts of potential standards case, the average savings are
efficiencies, and having roughly standards on selected consumer less than the difference between the
comparable equipment availability). The subgroups. These analyses are discussed average LCC of the baseline product and
use of representative ELs provided for in the following sections. the average LCC at each TSL. The
greater distinction between the TSLs. a. Life-Cycle Cost and Payback Period savings refer only to consumers who are
While representative ELs were included affected by a standard at a given TSL.
in the TSLs, DOE considered all In general, higher-efficiency products Those who already purchase a product
efficiency levels as part of its affect consumers in two ways: (1) with efficiency at or above a given TSL
analysis.101 purchase price increases and (2) annual are not affected. Consumers for whom
operating costs decrease. Inputs used for the LCC increases at a given TSL
B. Economic Justification and Energy calculating the LCC and PBP include
Savings experience a net cost. Chapter 8 of the
total installed costs (i.e., product price NOPR TSD provides detailed
1. Economic Impacts on Individual plus installation costs), and operating information on the LCC and PBP
Consumers costs (i.e., annual energy use, energy analyses.
prices, energy price trends, repair costs,
DOE analyzed the economic impacts and maintenance costs). The LCC Liquid-Immersed Distribution
on distribution transformers consumers calculation also uses product lifetime Transformers
TABLE V.2—AVERAGE LCC AND PBP RESULTS FOR REPRESENTATIVE UNIT 1

Average costs
(2021$) Simple Average
payback
Standard level lifetime
Lifetime period
First year’s (years)
Installed cost operating LCC (years)
operating cost cost
0 ............................................................... 2,917 67 1,346 4,263 ........................ 31.9

1 ............................................................... 2,983 66 1,328 4,311 86.7 31.9
2 ............................................................... 3,073 65 1,299 4,373 73.0 31.9
3 ............................................................... 3,294 48 969 4,263 19.2 31.9
4 ............................................................... 3,279 45 913 4,192 16.0 31.9
5 ............................................................... 4,080 39 778 4,859 40.9 31.9
Rep unit 1 represents 20.3 percent of liquid-immersed distribution transformers units shipped, and 21.8 percent of shipments for equipment
class 1 (single phase liquid-immersed).
101 Efficiency levels that were analyzed for this document. Results by efficiency level are presented
NOPR are discussed in section IV.F.2 of this in TSD chapters 8, 10, and 12.
TABLE V.3—LCC SAVINGS RELATIVE TO THE BASE CASE EFFICIENCY DISTRIBUTION FOR REPRESENTATIVE UNIT 1
Average savings—
% Consumers with
Standard level impacted consumers
net cost (2021)$ *
1 ....................................................................................................................................................... 68.8 ¥53

2 ....................................................................................................................................................... 85.5 ¥114
3 ....................................................................................................................................................... 47.4 0
4 ....................................................................................................................................................... 33.7 72
5 ....................................................................................................................................................... 95.6 ¥599
* The savings represent the average LCC for affected consumers.

Average costs
payback
First year’s Lifetime period (years)
Installed cost operating operating LCC (years)
cost cost
0 ............................................................... 1,805 41 818 2,623 ........................ 31.9

1 ............................................................... 1,805 33 673 2,478 0.1 31.9
2 ............................................................... 1,810 30 613 2,423 0.5 31.9
3 ............................................................... 1,857 29 580 2,437 4.1 31.9
4 ............................................................... 1,951 27 541 2,492 10.1 31.9
5 ............................................................... 2,347 23 452 2,799 29.1 31.9
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 21.9 146

2 ....................................................................................................................................................... 9.6 201
3 ....................................................................................................................................................... 9.3 186
4 ....................................................................................................................................................... 13.3 131
5 ....................................................................................................................................................... 84.3 ¥176

Average costs
payback
cost cost
0 ............................................................... 10,728 427 8,523 19,251 ........................ 31.8

1 ............................................................... 11,269 335 6,900 18,169 5.9 31.8
2 ............................................................... 11,304 323 6,668 17,972 5.6 31.8
3 ............................................................... 11,754 305 6,284 18,038 8.4 31.8
4 ............................................................... 12,568 275 5,656 18,225 12.2 31.8
5 ............................................................... 14,920 234 4,744 19,664 21.8 31.8
Rep unit 3 represents 0.2 percent of liquid-immersed distribution transformers units shipped, and 0.2 percent of shipments for equipment class
1 (single phase liquid-immersed).
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 27.9 1,121

2 ....................................................................................................................................................... 22.2 1,312
3 ....................................................................................................................................................... 23.3 1,216
TABLE V.7—LCC SAVINGS RELATIVE TO THE BASE CASE EFFICIENCY DISTRIBUTION FOR REPRESENTATIVE UNIT 3—
Continued
Average savings—
% Consumers with
net cost (2021)$ *
4 ....................................................................................................................................................... 22.5 1,029

5 ....................................................................................................................................................... 64.5 ¥414

Average costs
payback
cost cost
0 ............................................................... 10,319 196 3,913 14,232 ........................ 32.0

1 ............................................................... 10,403 193 3,846 14,249 25.8 32.0
2 ............................................................... 10,596 184 3,689 14,285 24.1 32.0
3 ............................................................... 11,095 137 2,768 13,863 13.1 32.0
4 ............................................................... 11,120 129 2,616 13,736 11.9 32.0
5 ............................................................... 11,798 117 2,359 14,156 18.7 32.0
class 2 (three phase liquid-immersed).
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 38.2 ¥26

2 ....................................................................................................................................................... 66.6 ¥55
3 ....................................................................................................................................................... 24.8 381
4 ....................................................................................................................................................... 12.9 511
5 ....................................................................................................................................................... 48.9 77

Average costs
payback
cost cost
0 ............................................................... 35,245 1,195 23,754 58,999 ........................ 31.7

1 ............................................................... 36,431 1,079 21,647 58,078 10.2 31.7
2 ............................................................... 36,603 1,006 20,349 56,952 7.2 31.7
3 ............................................................... 37,550 966 19,573 57,123 10.0 31.7
4 ............................................................... 39,455 891 18,002 57,457 13.8 31.7
5 ............................................................... 52,032 744 14,880 66,912 37.2 31.7
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 41.0 986

2 ....................................................................................................................................................... 26.7 2,095
3 ....................................................................................................................................................... 28.7 1,888
4 ....................................................................................................................................................... 28.5 1,543
Continued
Average savings—
% Consumers with
net cost (2021)$ *
5 ....................................................................................................................................................... 95.8 ¥7,913


Average costs
payback
cost cost
0 ............................................................... 10,749 196 3,919 14,668 ........................ 32.0

1 ............................................................... 10,833 193 3,855 14,687 26.3 32.0
2 ............................................................... 11,026 185 3,700 14,727 24.5 32.0
3 ............................................................... 11,523 137 2,778 14,301 13.1 32.0
4 ............................................................... 11,548 129 2,628 14,176 12.0 32.0
5 ............................................................... 12,228 117 2,367 14,595 18.8 32.0
Rep unit 15 represents <0.1 percent of liquid-immersed distribution transformers units shipped, and 0.4 percent of equipment class 12
shipments.
Average savings—
% Consumers with
net cost (2021$) *
1 ....................................................................................................................................................... 38.3 ¥30

2 ....................................................................................................................................................... 67.3 ¥61
3 ....................................................................................................................................................... 24.5 379
4 ....................................................................................................................................................... 12.8 507
5 ....................................................................................................................................................... 49.4 74
Rep unit 15 represents <0.1 percent of liquid-immersed distribution transformers units shipped, and 0.4 percent of shipments for equipment
class 12 (three phase liquid-immersed submersible).

Average costs
payback
cost cost
0 ............................................................... 35,814 1,255 25,345 61,159 ........................ 32.1

1 ............................................................... 37,015 1,146 23,365 60,380 11.0 32.1
2 ............................................................... 37,183 1,085 22,313 59,496 8.0 32.1
3 ............................................................... 38,135 1,045 21,549 59,684 11.1 32.1
4 ............................................................... 40,044 961 19,748 59,791 14.4 32.1
5 ............................................................... 52,622 789 16,044 68,666 36.1 32.1
Average savings—
% Consumers with
net cost (2021$) *
1 ....................................................................................................................................................... 42.0 829

2 ....................................................................................................................................................... 28.9 1,700
3 ....................................................................................................................................................... 32.3 1,482
4 ....................................................................................................................................................... 29.5 1,368
Continued
Average savings—
% Consumers with
net cost (2021$) *
5 ....................................................................................................................................................... 95.1 ¥7,509


Average costs
payback
cost cost
0 ............................................................... 55,256 3,485 71,294 126,550 ........................ 32.1

1 ............................................................... 70,709 2,485 50,618 121,327 15.5 32.1
2 ............................................................... 72,775 2,283 47,047 119,822 14.6 32.1
3 ............................................................... 74,623 2,208 45,574 120,197 15.2 32.1
4 ............................................................... 78,307 2,028 41,715 120,023 15.8 32.1
5 ............................................................... 102,728 1,650 33,556 136,283 25.9 32.1
Average savings—
% Consumers with
net cost (2021$) *
1 ....................................................................................................................................................... 42.8 5,346

2 ....................................................................................................................................................... 34.2 6,873
3 ....................................................................................................................................................... 36.8 6,472
4 ....................................................................................................................................................... 41.5 6,594
5 ....................................................................................................................................................... 73.9 ¥9,755
Low-Voltage Dry-Type Distribution

Transformers

Average costs
payback
cost cost
0 ............................................................... 1,737 97 1,424 3,161 ........................ 31.9

1 ............................................................... 1,735 90 1,327 3,063 0.0 31.9
2 ............................................................... 1,783 83 1,220 3,003 3.3 31.9
3 ............................................................... 1,890 77 1,127 3,017 7.6 31.9
4 ............................................................... 2,144 62 908 3,053 11.7 31.9
5 ............................................................... 2,311 48 703 3,014 11.7 31.9
Rep unit 6 represents 9.3 percent of low-voltage dry-type distribution transformers units shipped, and 100.0 percent of shipments for equip-
ment class 3 (single phase low-voltage dry-type).
Average savings—im-
% Consumers with
Standard level pacted consumers
net cost (2021$) *
1 ....................................................................................................................................................... 1 312
Continued
Average savings—im-
% Consumers with
Standard level pacted consumers
net cost (2021$) *
2 ....................................................................................................................................................... 17 203
3 ....................................................................................................................................................... 33 146
4 ....................................................................................................................................................... 43 108
5 ....................................................................................................................................................... 40 147
ment class 3 (single phase low-voltage dry-type).

Average costs
payback
cost cost
0 ............................................................... 3,974 228 3,366 7,340 ........................ 32.1

1 ............................................................... 3,929 211 3,114 7,043 0.0 32.1
2 ............................................................... 3,920 206 3,029 6,950 0.0 32.1
3 ............................................................... 4,266 193 2,842 7,108 8.2 32.1
4 ............................................................... 4,621 143 2,102 6,723 7.5 32.1
5 ............................................................... 4,829 132 1,947 6,776 8.9 32.1
ment class 4 (three phase low-voltage dry-type).
Average savings—
% Consumers with
net cost (2021$) *
1 ....................................................................................................................................................... 8 357
2 ....................................................................................................................................................... 7 397
3 ....................................................................................................................................................... 28 233
4 ....................................................................................................................................................... 9 617
5 ....................................................................................................................................................... 15 564
ment class 4 (three phase low-voltage dry-type).

Average costs
Standard level payback lifetime
First year’s Lifetime period (years) (years)
Installed cost operating operating LCC
cost cost
0 ............................................................... 9,252 632 9,207 18,459 ........................ 32.0

1 ............................................................... 9,348 613 8,937 18,285 5.2 32.0
2 ............................................................... 9,746 588 8,570 18,316 11.3 32.0
3 ............................................................... 10,620 542 7,898 18,517 15.2 32.0
4 ............................................................... 12,297 373 5,439 17,737 11.8 32.0
5 ............................................................... 12,297 373 5,439 17,737 11.8 32.0
Rep unit 8 represents 5.8 percent of low-voltage dry-type distribution transformers units shipped, and 6.4 percent of shipments for equipment
class 4 (three phase low-voltage dry-type).
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 12 355
2 ....................................................................................................................................................... 41 152
Continued
Average savings—
% Consumers with
net cost (2021)$ *
3 ....................................................................................................................................................... 57 ¥58
4 ....................................................................................................................................................... 31 722
5 ....................................................................................................................................................... 31 722
Rep unit 8 represents 5.8 percent of low-voltage dry-type distribution transformers units shipped, and 6.4 percent of shipments for equipment
class 4 (three phase low-voltage dry-type).
Medium-Voltage Dry-Type Distribution

Transformers

Average costs
payback
Lifetime period
First year’s (years)
Installed cost operating LCC (years)
operating cost cost
0 ............................................................... 14,830 918 13,450 28,281 ........................ 32.1

1 ............................................................... 14,874 895 13,115 27,990 2.0 32.1
2 ............................................................... 14,961 862 12,628 27,589 2.4 32.1
3 ............................................................... 15,984 800 11,725 27,709 9.8 32.1
4 ............................................................... 17,981 726 10,639 28,620 16.4 32.1
5 ............................................................... 19,047 602 8,823 27,870 13.4 32.1
Rep unit 9 represents 7.3 percent of medium-voltage dry-type distribution transformers units shipped, and 77.0 percent of shipments for equip-
ment class 6 (three phase medium-voltage dry-type, 20–45 kV BIL).
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 4 1,039
2 ....................................................................................................................................................... 10 887
3 ....................................................................................................................................................... 39 571
4 ....................................................................................................................................................... 64 ¥339
5 ....................................................................................................................................................... 49 410

Average costs
payback
cost cost
0 ............................................................... 45,167 2,799 41,003 86,169 ........................ 32.0

1 ............................................................... 45,363 2,674 39,185 84,548 1.6 32.0
2 ............................................................... 47,461 2,597 38,056 85,516 11.4 32.0
3 ............................................................... 55,429 2,276 33,366 88,794 19.7 32.0
4 ............................................................... 59,426 2,039 29,887 89,313 18.8 32.0

5 ............................................................... 67,353 1,838 26,950 94,303 23.1 32.0
Rep unit 10 represents 2.2 percent of medium-voltage dry-type distribution transformers units shipped, and 23.0 percent of shipments for
equipment class 6 (three phase medium-voltage dry-type, 20–45 kV BIL).
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 15 1,854
2 ....................................................................................................................................................... 38 653
3 ....................................................................................................................................................... 78 ¥2,625
4 ....................................................................................................................................................... 81 ¥3,144
5 ....................................................................................................................................................... 91 ¥8,133

Average costs
payback
cost cost
0 ............................................................... 20,788 1,190 17,353 38,141 ........................ 32.0

1 ............................................................... 20,948 1,156 16,859 37,807 4.7 32.0
2 ............................................................... 21,792 1,106 16,123 37,915 11.9 32.0
3 ............................................................... 23,458 951 13,870 37,328 11.2 32.0
4 ............................................................... 23,880 859 12,516 36,396 9.3 32.0
5 ............................................................... 25,903 769 11,216 37,119 12.2 32.0
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 26 438
2 ....................................................................................................................................................... 46 226
3 ....................................................................................................................................................... 35 813
4 ....................................................................................................................................................... 15 1,744
5 ....................................................................................................................................................... 38 1,021

Average costs
payback
cost cost
0 ............................................................... 54,830 3,290 47,795 102,625 ........................ 32.0

1 ............................................................... 52,818 3,138 45,595 98,413 0.0 32.0
2 ............................................................... 55,069 3,063 44,505 99,574 1.1 32.0
3 ............................................................... 63,490 2,659 38,639 102,129 13.7 32.0
4 ............................................................... 67,333 2,430 35,311 102,644 14.5 32.0
5 ............................................................... 74,722 2,206 32,055 106,777 18.4 32.0
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 1 4,649
2 ....................................................................................................................................................... 9 3,051
3 ....................................................................................................................................................... 49 496
Continued
Average savings—
% Consumers with
net cost (2021)$ *
4 ....................................................................................................................................................... 54 ¥19
5 ....................................................................................................................................................... 80 ¥4,152

Average costs
payback
cost cost
0 ............................................................... 85,302 9,986 145,749 231,051 ........................ 32.2

1 ............................................................... 103,468 6,764 98,728 202,196 5.6 32.2
2 ............................................................... 113,456 6,493 94,798 208,254 8.1 32.2
3 ............................................................... 134,347 5,429 79,221 213,567 10.8 32.2
4 ............................................................... 137,299 5,289 77,183 214,481 11.1 32.2
5 ............................................................... 153,330 4,864 71,007 224,338 13.3 32.2
Average savings—
% Consumers with
net cost (2021$) *
1 ....................................................................................................................................................... 5 28,855
2 ....................................................................................................................................................... 12 22,797
3 ....................................................................................................................................................... 24 17,483
4 ....................................................................................................................................................... 26 16,570
5 ....................................................................................................................................................... 44 6,713

Average costs
payback
cost cost
0 ............................................................... 24,894 1,316 19,168 44,062 ........................ 31.9

1 ............................................................... 25,304 1,256 18,292 43,597 6.8 31.9
2 ............................................................... 26,181 1,212 17,653 43,835 12.4 31.9
3 ............................................................... 28,454 1,111 16,176 44,630 17.3 31.9
4 ............................................................... 31,436 986 14,364 45,801 19.8 31.9
5 ............................................................... 31,983 936 13,636 45,619 18.7 31.9
ment class 10 (three phase medium-voltage dry-type, ≥96 kV BIL).
Average savings—
% Consumers with
net cost (2021$) *
1 ....................................................................................................................................................... 24 515
2 ....................................................................................................................................................... 44 228
3 ....................................................................................................................................................... 72 ¥568
4 ....................................................................................................................................................... 81 ¥1,739
Continued
Average savings—
% Consumers with
net cost (2021$) *
5 ....................................................................................................................................................... 80 ¥1,557

Average costs
payback
cost cost
0 ............................................................... 63,684 4,386 63,615 127,299 ........................ 32.0

1 ............................................................... 66,945 4,263 61,834 128,779 26.6 32.0
2 ............................................................... 70,089 4,140 60,066 130,155 26.1 32.0
3 ............................................................... 80,939 3,629 52,588 133,527 22.8 32.0
4 ............................................................... 85,714 3,281 47,555 133,268 19.9 32.0
5 ............................................................... 93,684 3,027 43,893 137,577 22.1 32.0
equipment class 10 (three phase medium-voltage dry-type, ≥96 kV BIL).
Average savings—
% Consumers with impacted
Standard level net cost consumers
(2021$) *
1 ....................................................................................................................................................... 88 ¥1,480
2 ....................................................................................................................................................... 87 ¥2,856
3 ....................................................................................................................................................... 78 ¥6,228
4 ....................................................................................................................................................... 82 ¥5,969
5 ....................................................................................................................................................... 93 ¥10,278
equipment class 10 (three phase medium-voltage dry-type, ≥96 kV BIL).

Average costs
payback
cost cost
0 ............................................................... 88,951 9,349 136,177 225,128 ........................ 31.9

1 ............................................................... 107,573 7,209 105,019 212,591 8.7 31.9
2 ............................................................... 117,299 6,845 99,747 217,046 11.3 31.9
3 ............................................................... 137,304 5,717 83,212 220,516 13.3 31.9
4 ............................................................... 142,539 5,455 79,409 221,948 13.8 31.9
5 ............................................................... 154,646 5,105 74,341 228,988 15.5 31.9
Average savings—
% Consumers with
net cost (2021)$ *
1 ....................................................................................................................................................... 16 12,536
2 ....................................................................................................................................................... 38 8,082
3 ....................................................................................................................................................... 43 4,611
4 ....................................................................................................................................................... 47 3,180
Continued
Average savings—
% Consumers with
net cost (2021)$ *
5 ....................................................................................................................................................... 63 ¥3,860
b. Consumer Subgroup Analysis utilities who serve low population classes 1 and 2. Chapter 11 of the NOPR
In the consumer subgroup analysis, densities. Table V.40 compares the TSD presents the complete LCC and
DOE estimated the impact of the average LCC savings and PBP at each PBP results for the subgroups.
considered TSLs on utilities who deploy efficiency level for the consumer
Utilities Serving Low Population
distribution transformers in vaults or subgroups with similar metrics for the
Densities
other space constrained areas, and entire consumer sample for equipment
TABLE V.40—COMPARISON OF LCC SAVINGS AND PBP FOR UTILITIES SERVING LOW POPULATION DENSITIES SUBGROUP
AND ALL UTILITIES; REPRESENTATIVE UNIT 1
Serving low
TSL All utilities population densities
Average LCC Savings (2021$)
1 ............................................................................................................................................... ¥53 ¥55

2 ............................................................................................................................................... ¥114 ¥112
3 ............................................................................................................................................... 0 90
4 ............................................................................................................................................... 72 178
5 ............................................................................................................................................... ¥599 ¥497
Payback Period (years)
1 ............................................................................................................................................... 78.6 120.6

2 ............................................................................................................................................... 69.2 86.0
3 ............................................................................................................................................... 19.3 19.0
4 ............................................................................................................................................... 16.2 15.8
5 ............................................................................................................................................... 40.5 42.2
Consumers with Net Cost (%)
1 ............................................................................................................................................... 69 66
2 ............................................................................................................................................... 86 82
3 ............................................................................................................................................... 47 33
4 ............................................................................................................................................... 34 20
5 ............................................................................................................................................... 96 92
Serving low
1 ............................................................................................................................................... 146 189

2 ............................................................................................................................................... 201 267
3 ............................................................................................................................................... 186 253
4 ............................................................................................................................................... 131 199
5 ............................................................................................................................................... ¥176 ¥107
1 ............................................................................................................................................... 0.0 0.0

2 ............................................................................................................................................... 0.4 0.3
3 ............................................................................................................................................... 4.1 3.9
4 ............................................................................................................................................... 10.1 9.9
5 ............................................................................................................................................... 29.3 30.2
AND ALL UTILITIES; REPRESENTATIVE UNIT 2—Continued
Serving low
1 ............................................................................................................................................... 22 21
2 ............................................................................................................................................... 10 7
3 ............................................................................................................................................... 9 7
4 ............................................................................................................................................... 13 10
5 ............................................................................................................................................... 84 72
Serving low
1 ............................................................................................................................................... 1,121 1,798

2 ............................................................................................................................................... 1,312 2,044
3 ............................................................................................................................................... 1,216 1,962
4 ............................................................................................................................................... 1,029 1,772
5 ............................................................................................................................................... ¥414 308
1 ............................................................................................................................................... 5.9 5.3

2 ............................................................................................................................................... 5.6 5.1
3 ............................................................................................................................................... 8.4 7.8
4 ............................................................................................................................................... 12.3 11.9
5 ............................................................................................................................................... 21.8 22.3
1 ............................................................................................................................................... 28 22
2 ............................................................................................................................................... 22 16
3 ............................................................................................................................................... 23 16
4 ............................................................................................................................................... 23 15
5 ............................................................................................................................................... 65 44
TABLE V.43—COMPARISON OF LCC SAVINGS AND PBP UTILITIES SERVING LOW POPULATION DENSITIES SUBGROUP AND
ALL UTILITIES; REPRESENTATIVE UNIT 4
Serving low population
TSL All utilities densities
1 ............................................................................................................................................... ¥26 ¥12

2 ............................................................................................................................................... ¥55 ¥9
3 ............................................................................................................................................... 381 629
4 ............................................................................................................................................... 511 802
5 ............................................................................................................................................... 77 372
1 ............................................................................................................................................... 26.9 28.0

2 ............................................................................................................................................... 24.4 24.4
3 ............................................................................................................................................... 13.2 13.1
4 ............................................................................................................................................... 12.0 11.9

5 ............................................................................................................................................... 18.7 19.1
1 ............................................................................................................................................... 38 37
2 ............................................................................................................................................... 67 58
3 ............................................................................................................................................... 25 21
TABLE V.43—COMPARISON OF LCC SAVINGS AND PBP UTILITIES SERVING LOW POPULATION DENSITIES SUBGROUP AND
ALL UTILITIES; REPRESENTATIVE UNIT 4—Continued
Serving low population
TSL All utilities densities
4 ............................................................................................................................................... 13 9
5 ............................................................................................................................................... 49 32
Serving low
1 ............................................................................................................................................... 986 1,498

2 ............................................................................................................................................... 2,095 2,876
3 ............................................................................................................................................... 1,888 2,839
4 ............................................................................................................................................... 1,543 2,830
5 ............................................................................................................................................... ¥7,913 ¥5,881
1 ............................................................................................................................................... 11.0 10.1

2 ............................................................................................................................................... 8.0 7.1
3 ............................................................................................................................................... 11.0 9.9
4 ............................................................................................................................................... 14.2 13.8
5 ............................................................................................................................................... 35.8 37.3
1 ............................................................................................................................................... 41 38
2 ............................................................................................................................................... 27 23
3 ............................................................................................................................................... 29 24
4 ............................................................................................................................................... 29 19
5 ............................................................................................................................................... 96 89
Utilities That Deploy Distribution purchase cost for a product that meets distribution transformers. While DOE
Transformers in Vaults or Other Space the standard is less than three times the examined the rebuttable-presumption
Constrained Areas value of the first-year energy savings criterion, it considered whether the
As noted in section IV.C.1, for this resulting from the standard. In standard levels considered for the NOPR
NOPR DOE considered submersible calculating a rebuttable presumption are economically justified through a
distribution transformers and their payback period for each of the more detailed analysis of the economic
associated vault, or space constrained considered standard level, DOE used impacts of those levels, pursuant to 42
installation costs with individual discrete values, and as required by U.S.C. 6295(o)(2)(B)(i), that considers
representative units, 15 and 16. The EPCA, based the energy use calculation the full range of impacts to the
consumer results for these equipment on the DOE test procedure for consumer, manufacturer, Nation, and
are presented in Table V.12 through distribution transformers. In contrast, environment. The results of that
Table V.15. the PBPs presented in section V.B.1.a analysis serve as the basis for DOE to
were calculated using distributions that
c. Rebuttable Presumption Payback definitively evaluate the economic
reflect the range of energy use in the
justification for a potential standard
As discussed in section IV.F.11, EPCA field.
establishes a rebuttable presumption Table V.45 presents the rebuttable- level, thereby supporting or rebutting
that an energy conservation standard is presumption payback periods for the the results of any preliminary
economically justified if the increased considered standard level for determination of economic justification.
TABLE V.45—REBUTTABLE-PRESUMPTION PAYBACK PERIODS


EC RU
1 2 3 4 5
1 ............................................................... 1 15.9 19.9 25.3 22.1 25.7

1 ............................................................... 2 0.1 6.4 9.3 12.1 19.7
1 ............................................................... 3 0 0 74.6 19.1 17.9
TABLE V.45—REBUTTABLE-PRESUMPTION PAYBACK PERIODS—Continued

EC RU
1 2 3 4 5
2 ............................................................... 4 11.2 22.9 14.2 13.2 14.1

2 ............................................................... 5 0 0 0 21.1 26.1
2 ............................................................... 17 8.4 9.7 10.3 10.0 14.6
3 ............................................................... 6 0 2.3 4.3 8.7 8.7
4 ............................................................... 7 0 0 3.8 8.1 6.9
6 ............................................................... 8 5.6 8.1 9.7 10.6 10.6
6 ............................................................... 9 1.3 1.4 4.6 7.9 9.7
8 ............................................................... 10 1.4 6.6 18.4 15.4 16.0
8 ............................................................... 11 1.4 4.9 8.9 8.7 8.7
8 ............................................................... 18 4.6 5.8 9.7 9.6 10.2
10 ............................................................. 12 0 0.6 63.2 18.2 15.4
10 ............................................................. 13 5.5 10.2 12.5 43.4 25.3
10 ............................................................. 14 21.4 11.4 ¥67.7 39.4 24.4
10 ............................................................. 19 5.6 6.5 12.7 12.0 12.0
12 ............................................................. 15 n.a. n.a. n.a. n.a. 14.1
12 ............................................................. 16 n.a. n.a. n.a. n.a. 26.2
2. Economic Impacts on Manufacturers As discussed in section IV.J.2.d of this Each of the modeled scenarios results
document, DOE modeled two scenarios in a unique set of cash-flows and
DOE performed an MIA to estimate to evaluate a range of cash flow impacts corresponding industry values at each
the impact of amended energy on the distribution transformer industry: TSL for each type of distribution
conservation standards on (1) the preservation of gross margin transformer manufacturers. In the
manufacturers of distribution percentage scenario and (2) the following discussion, the INPV results
transformers. The following section preservation of operating profit refer to the difference in industry value
describes the expected impacts on scenario. In the preservation of gross
manufacturers at each considered TSL. between the no-new-standards case and
margin percentage scenario, distribution each standards case resulting from the
Chapter 12 of the NOPR TSD explains transformer manufacturers are able to
the analysis in further detail. sum of discounted cash-flows from 2022
maintain the same gross margin through 2056. To provide perspective
a. Industry Cash Flow Analysis Results percentage, even as the MPCs of on the short-run cash-flow impact, DOE
distribution transformers increase due
includes in the discussion of results a
In this section, DOE provides GRIM to energy conservation standards. In this
comparison of free cash flow between
results from the analysis, which scenario, the same gross margin
examines changes in the industry that percentage of 20 percent 102 is applied the no-new-standards case and the
would result from a standard. The across all efficiency levels. In the standards case at each TSL in the year
following tables summarize the preservation of operating profit before amended standards are required.
estimated financial impacts (represented scenario, manufacturers do not earn DOE presents the range in INPV for
by changes in INPV) of potential additional operating profit when liquid-immersed distribution
amended energy conservation standards compared to the no-standards case transformer manufacturers in Table V.46
on manufacturers of distribution scenario. While manufacturers make the and Table V.47; the range in INPV for
transformers, as well as the conversion necessary upfront investments required LVDT distribution transformer
costs that DOE estimates manufacturers to produce compliant equipment, per- manufacturers in Table V.48 and Table
of distribution transformers would incur unit operating profit does not change in V.49; and the range in INPV for MVDT
at each TSL. DOE analyzes the potential absolute dollars. The preservation of distribution transformer manufacturers
impacts on INPV separately for each operating profit scenario results in the in Table V.50 and Table V.51.
type of distribution transformer lower (or more severe) bound to impacts
manufacturers: liquid-immersed; LVDT; of potential amended standards on Liquid-Immersed Distribution
and MVDT. industry. Transformers
TABLE V.46—MANUFACTURER IMPACT ANALYSIS FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS—PRESERVATION

OF GROSS MARGIN PERCENTAGE SCENARIO
No-new- Trial standard level

Units standards
case 1 2 3 4 5
INPV ............................................. 2021$ millions ............................... 1,384 1,297 1,268 1,232 1,233 1,347
Change in INPV ............................ 2021$ millions ............................... ................ (87.1) (116.5) (152.1) (151.0) (37.2)
% ................................................... ................ (6.3) (8.4) (11.0) (10.9) (2.7)
Product Conversion Costs ............ 2021$ millions ............................... ................ 72.0 82.5 99.1 102.0 102.9
Capital Conversion Costs ............. 2021$ millions ............................... ................ 56.6 92.6 150.3 168.5 186.6
102 The gross margin percentage of 20 percent is
based on a manufacturer markup of 1.25.

OF GROSS MARGIN PERCENTAGE SCENARIO—Continued

Units standards
case 1 2 3 4 5
Total Conversion Costs ......... 2021$ millions ............................... ................ 128.6 175.2 249.4 270.6 289.4
* Numbers in parentheses ‘‘( )’’ are negative. Some numbers might not round due to rounding.

OF OPERATING PROFIT SCENARIO

Units standards
case 1 2 3 4 5
INPV ............................................. 2021$ millions ............................... 1,384 1,283 1,242 1,166 1,133 1,004
% ................................................... ................ (7.3) (10.3) (15.8) (18.1) (27.5)
At TSL 1, DOE estimates the impacts slight cost increase to customers. The DOE estimates that approximately 1.4
on INPV for liquid-immersed slight increase in shipment-weighted percent of shipments would meet or
distribution transformer manufacturers average MPC is outweighed by the exceed these energy conservation
to range from ¥$101.1 million to $128.6 million in conversion costs, standards in the no-new-standards case
¥$87.1 million, corresponding to a causing a negative change in INPV at in 2027. DOE estimates liquid-immersed
change in INPV of ¥7.3 percent to ¥6.3 TSL 1 under the preservation of gross distribution transformer manufacturers
percent. At TSL 1, industry free cash margin percentage scenario. would spend approximately $82.5
flow is estimated to decrease by Under the preservation of operating million in product conversion costs to
approximately 56.0 percent to $40.2 profit scenario, manufacturers earn the redesign transformers and
million, compared to the no-new- same per-unit operating profit as would approximately $92.6 million in capital
standard case value of $91.2 million in be earned in the no-new-standards case, conversion costs as many liquid-
2026, the year before the estimated but manufacturers do not earn immersed distribution transformer cores
compliance date. additional profit from their investments manufactured are expected to use
TSL 1 would set the energy or higher MPCs. In this scenario, the 0.6 amorphous steel.
conservation standard at EL 1 for all percent shipment-weighted average At TSL 2, the shipment-weighted
liquid-immersed distribution MPC increase results in a reduction in average MPC for liquid-immersed
transformers except for submersible the margin after the analyzed distribution transformers increases by
liquid-immersed transformers compliance year. This reduction in the 1.7 percent relative to the no-new-
(Equipment Class 12, Rep. Unit 15 and margin and the $128.6 million in standards case shipment-weighted
conversion costs incurred by average MPC in 2027. The increase in
16), which would remain at baseline.
manufacturers cause a negative change shipment-weighted average MPC is
DOE estimates that approximately 4.3
in INPV at TSL 1 under the preservation outweighed by the $175.2 million in
percent of shipments would meet or
of operating profit scenario. conversion costs, causing a negative
exceed these energy conservation At TSL 2, DOE estimates the impacts change in INPV at TSL 2 under the
standards in the no-new-standards case on INPV for liquid-immersed preservation of gross margin percentage
in 2027. DOE estimates liquid-immersed distribution transformer manufacturers scenario.
distribution transformer manufacturers to range from ¥$142.1 million to Under the preservation of operating
would spend approximately $72.0 ¥$116.5 million, corresponding to a profit scenario, the 1.7 percent
million in product conversion costs to change in INPV of ¥10.3 percent to shipment-weighted average MPC
redesign transformers and ¥8.4 percent. At TSL 2, industry free increase results in a reduction in the
approximately $56.6 million in capital cash flow is estimated to decrease by margin after the analyzed compliance
conversion costs as some liquid- approximately 77.8 percent to $20.2 year. This reduction in the margin and
immersed distribution transformer cores million, compared to the no-new- the $175.2 million in conversion costs
manufactured are expected to use standard case value of $91.2 million in incurred by manufacturers cause a
amorphous steel. 2026, the year before the estimated negative change in INPV at TSL 2 under
At TSL 1, the shipment-weighted
compliance date. the preservation of operating profit

average MPC for liquid-immersed TSL 2 would set the energy scenario.
distribution transformers increases by conservation standard at EL 2 for all At TSL 3, DOE estimates the impacts
0.6 percent relative to the no-new- liquid-immersed distribution on INPV for liquid-immersed
standards case shipment-weighted transformers except for submersible distribution transformer manufacturers
average MPC in 2027. In the gross liquid-immersed transformers to range from ¥$218.3 million to
margin percentage scenario, (Equipment Class 12, Rep. Unit 15 and ¥$152.1 million, corresponding to a
manufacturers can fully pass on this 16), which would remain at baseline. change in INPV of ¥15.8 percent to
¥11.0 percent. At TSL 3, industry free ¥$151.0 million, corresponding to a distribution transformer manufacturers
cash flow is estimated to decrease by change in INPV of ¥18.1 percent to to range from ¥$380.7 million to
approximately 112.8 percent to ¥$11.6 ¥10.9 percent. At TSL 4, industry free ¥$37.2 million, corresponding to a
million, compared to the no-new- cash flow is estimated to decrease by change in INPV of ¥27.5 percent to
standard case value of $91.2 million in approximately 122.9 percent to ¥$20.9 ¥2.7 percent. At TSL 5, industry free
2026, the year before the estimated million, compared to the no-new- cash flow is estimated to decrease by
compliance date. standard case value of $91.2 million in approximately 132.1 percent to ¥$29.3
TSL 3 would set the energy 2026, the year before the estimated million, compared to the no-new-
conservation standard at EL 3 for all compliance date. standard case value of $91.2 million in
liquid-immersed distribution TSL 4 would set the energy 2026, the year before the estimated
transformers except for submersible conservation standard at EL 4 for all compliance date.
liquid-immersed transformers liquid-immersed distribution
TSL 5 would set the energy
(Equipment Class 12, Rep. Unit 15 and transformers except for submersible
conservation standard at EL 5, max-tech,
16), which would remain at baseline. liquid-immersed transformers
for all liquid-immersed distribution
DOE estimates that approximately 0.9 (Equipment Class 12, Rep. Unit 15 and
transformers. DOE estimates that
percent of shipments would meet or 16), which would remain at baseline.
approximately 0.2 percent of shipments
exceed these energy conservation DOE estimates that approximately 0.7
standards in the no-new-standards case percent of shipments would meet or would meet these energy conservation
in 2027. DOE estimates liquid-immersed exceed these energy conservation standards in the no-new-standards case
distribution transformer manufacturers standards in the no-new-standards case in 2027. DOE estimates liquid-immersed
would spend approximately $99.1 in 2027. DOE estimates liquid-immersed distribution transformer manufacturers
million in product conversion costs to distribution transformer manufacturers would spend approximately $102.9
redesign transformers and would spend approximately $102.0 million in product conversion costs to
approximately $150.3 million in capital million in product conversion costs to redesign transformers and
conversion costs as most liquid- redesign transformers and approximately $186.6 million in capital
immersed distribution transformer cores approximately $168.5 million in capital conversion costs as almost all liquid-
manufactured are expected to use conversion costs as almost all liquid- immersed distribution transformer cores
amorphous steel. immersed distribution transformer cores manufactured are expected to use
At TSL 3, the shipment-weighted manufactured are expected to use amorphous steel.
average MPC for liquid-immersed amorphous steel. At TSL 5, the shipment-weighted
distribution transformers increases by At TSL 4, the shipment-weighted average MPC for liquid-immersed
5.6 percent relative to the no-new- average MPC for liquid-immersed distribution transformers increases by
standards case shipment-weighted distribution transformers increases by 33.3 percent relative to the no-new-
average MPC in 2027. The moderate 8.9 percent relative to the no-new- standards case shipment-weighted
increase in shipment-weighted average standards case shipment-weighted average MPC in 2027. The significant
MPC is outweighed by the $249.4 average MPC in 2027. The moderate increase in shipment-weighted average
million in conversion costs, causing a increase in shipment-weighted average MPC is outweighed by the $289.4
negative change in INPV at TSL 3 under MPC is outweighed by the $270.6 million in conversion costs, causing a
the preservation of gross margin million in conversion costs, causing a negative change in INPV at TSL 5 under
percentage scenario. negative change in INPV at TSL 4 under the preservation of gross margin
Under the preservation of operating the preservation of gross margin percentage scenario.
profit scenario, the 5.6 percent percentage scenario. Under the preservation of operating
shipment-weighted average MPC Under the preservation of operating profit scenario, the 33.3 percent
increase results in a reduction in the profit scenario, the 8.9 percent shipment-weighted average MPC
margin after the analyzed compliance shipment-weighted average MPC increase results in a reduction in the
year. This reduction in the margin and increase results in a reduction in the margin after the analyzed compliance
the $249.4 million in conversion costs margin after the analyzed compliance year. This reduction in the margin and
incurred by manufacturers cause a year. This reduction in the margin and the $289.4 million in conversion costs
negative change in INPV at TSL 3 under the $270.6 million in conversion costs incurred by manufacturers cause a
the preservation of operating profit incurred by manufacturers cause a negative change in INPV at TSL 5 under
scenario. negative change in INPV at TSL 4 under the preservation of operating profit
At TSL 4, DOE estimates the impacts the preservation of operating profit scenario.
on INPV for liquid-immersed scenario.
distribution transformer manufacturers At TSL 5, DOE estimates the impacts Low-Voltage Dry-Type Distribution
to range from ¥$251.3 million to on INPV for liquid-immersed Transformers
TABLE V.48—MANUFACTURER IMPACT ANALYSIS FOR LOW-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS—

PRESERVATION OF GROSS MARGIN PERCENTAGE SCENARIO
Units standards
case 1 2 3 4 5
INPV ............................................. 2021$ millions ............................... 194 189 189 177 168 161
% ................................................... ................ (2.8) (2.5) (8.7) (13.6) (17.2)

PRESERVATION OF GROSS MARGIN PERCENTAGE SCENARIO—Continued
Units standards
case 1 2 3 4 5

PRESERVATION OF OPERATING PROFIT SCENARIO
Units standards
case 1 2 3 4 5
INPV ............................................. 2021$ millions ............................... 194 189 188 167 145 133
% ................................................... ................ (2.8) (3.0) (13.9) (25.3) (31.4)
At TSL 1, DOE estimates the impacts At TSL 2, DOE estimates the impacts margin after the analyzed compliance
on INPV for LVDT distribution on INPV for LVDT distribution year. This reduction in the margin and
transformer manufacturers to be transformer manufacturers to range from the $9.6 million in conversion costs
approximately ¥$5.4 million, which ¥$5.9 million to ¥$4.9 million, incurred by manufacturers cause a
corresponds to a change in INPV of –2.8 corresponding to a change in INPV of negative change in INPV at TSL 2 under
percent. At TSL 1, industry free cash ¥2.8 percent to ¥2.5 percent. At TSL the preservation of operating profit
flow is estimated to decrease by 2, industry free cash flow is estimated scenario.
approximately 17.8 percent to $15.6 to decrease by approximately 17.8 At TSL 3, DOE estimates the impacts
million, compared to the no-new- percent to $15.6 million, compared to on INPV for LVDT distribution
standard case value of $19.0 million in the no-new-standard case value of $19.0 transformer manufacturers to range from
2026, the year before the estimated million in 2026, the year before the ¥$27.0 million to ¥$16.9 million,
compliance date. estimated compliance date. corresponding to a change in INPV of
TSL 1 would set the energy TSL 2 would set the energy ¥13.9 percent to ¥8.7 percent. At TSL
conservation standard at EL 1 for all conservation standard at EL 2 for all 3, industry free cash flow is estimated
LVDT distribution transformers. DOE LVDT distribution transformers. DOE to decrease by approximately 72.1
estimates that approximately 22.7 estimates that approximately 3.4 percent percent to $5.3 million, compared to the
percent of shipments would meet or of shipments would meet or exceed no-new-standard case value of $19.0
exceed these energy conservation these energy conservation standards in million in 2026, the year before the
standards in the no-new-standards case the no-new-standards case in 2027. DOE estimated compliance date.
estimates LVDT distribution transformer TSL 3 would set the energy
in 2027. DOE estimates LVDT
manufacturers would spend conservation standard at EL 3 for all
distribution transformer manufacturers
approximately $9.6 million in product LVDT distribution transformers. DOE
would spend approximately $9.6 estimates that approximately 0.1 percent
conversion costs to redesign
million in product conversion costs to of shipments would meet or exceed
transformers but would not have to
redesign transformers but would not these energy conservation standards in
make significant investments in capital
have to make significant investments in the no-new-standards case in 2027. DOE
conversion costs as no LVDT
capital conversion costs as no LVDT estimates LVDT distribution transformer
distribution transformer cores used are
distribution transformer cores used are manufacturers would spend
expected to use amorphous steel.
expected to use amorphous steel. At TSL 2, the shipment-weighted approximately $14.5 million in product
At TSL 1, the shipment-weighted average MPC for LVDT distribution conversion costs to redesign
average MPC for LVDT distribution transformers increases by 0.8 percent transformers and approximately $19.1
transformers does not increases relative relative to the no-new-standards case million in capital conversion costs as
to the no-new-standards case shipment- shipment-weighted average MPC in some LVDT distribution transformers
weighted average MPC in 2027. The 2027. The increase in shipment- cores manufactured are expected to use
preservation of gross margin percentage weighted average MPC is outweighed by amorphous steel.
scenario produces similar INPV results
the $9.6 million in conversion costs, At TSL 3, the shipment-weighted

as the preservation of operating profit causing a negative change in INPV at average MPC for LVDT distribution
scenario due to the negligible change in TSL 2 under the preservation of gross transformers increases by 8.5 percent
MPC at TSL 1. The change in IPNV is margin percentage scenario. relative to the no-new-standards case
driven exclusively by the $9.6 million Under the preservation of operating shipment-weighted average MPC in
in conversion costs, causing a negative profit scenario, the 0.8 percent 2027. The moderate increase in
change in INPV at TSL 1 under both shipment-weighted average MPC shipment-weighted average MPC is
scenarios. increase results in a reduction in the outweighed by the $33.5 million in
conversion costs, causing a negative transformer cores manufactured are DOE estimates that no shipments would
change in INPV at TSL 3 under the expected to use amorphous steel. meet these energy conservation
preservation of gross margin percentage At TSL 4, the shipment-weighted standards at TSL 5. DOE estimates
scenario. average MPC for LVDT distribution LVDT distribution transformer
Under the preservation of operating transformers increases by 19.0 percent manufacturers would spend
profit scenario, the 8.5 percent relative to the no-new-standards case approximately $19.1 million in product
shipment-weighted average MPC shipment-weighted average MPC in conversion costs to redesign all LVDT
increase results in a reduction in the 2027. The significant increase in distribution transformers and
margin after the analyzed compliance shipment-weighted average MPC is approximately $37.2 million in capital
year. This reduction in the margin and outweighed by the $56.1 million in conversion costs as all LVDT
the $33.5 million in conversion costs conversion costs, causing a negative distribution transformer cores
incurred by manufacturers cause a change in INPV at TSL 4 under the manufactured are expected to use
negative change in INPV at TSL 3 under preservation of gross margin percentage amorphous steel.
the preservation of operating profit scenario.
scenario. Under the preservation of operating At TSL 5, the shipment-weighted
At TSL 4, DOE estimates the impacts profit scenario, the 19.0 percent average MPC for LVDT distribution
on INPV for LVDT distribution shipment-weighted average MPC transformers increases by 23.0 percent
transformer manufacturers to range from increase results in a reduction in the relative to the no-new-standards case
¥$49.1 million to ¥$26.3 million, margin after the analyzed compliance shipment-weighted average MPC in
corresponding to a change in INPV of year. This reduction in the margin and 2027. The significant increase in
¥25.3 percent to ¥13.6 percent. At TSL the $56.1 million in conversion costs shipment-weighted average MPC is
4, industry free cash flow is estimated incurred by manufacturers cause a outweighed by the $69.4 million in
to decrease by approximately 123.2 negative change in INPV at TSL 4 under conversion costs, causing a negative
percent to ¥$4.4 million, compared to the preservation of operating profit change in INPV at TSL 5 under the
the no-new-standard case value of $19.0 scenario. preservation of gross margin percentage
million in 2026, the year before the At TSL 5, DOE estimates the impacts scenario.
estimated compliance date. on INPV for LVDT distribution Under the preservation of operating
TSL 4 would set the energy transformer manufacturers to range from profit scenario, the 23.0 percent
conservation standard at EL 4 for all ¥$61.0 million to ¥$33.5 million, shipment-weighted average MPC
LVDT distribution transformers. DOE corresponding to a change in INPV of increase results in a reduction in the
estimates that no shipments would meet ¥31.4 percent to ¥17.2 percent. At TSL margin after the analyzed compliance
these energy conservation standards in 5, industry free cash flow is estimated year. This reduction in the margin and
the no-new-standards case in 2027. DOE to decrease by approximately 154.4 the $69.4 million in conversion costs
estimates LVDT distribution transformer percent to ¥$10.4 million, compared to incurred by manufacturers cause a
manufacturers would spend the no-new-standard case value of $19.0 negative change in INPV at TSL 5 under
approximately $18.9 million in product million in 2026, the year before the the preservation of operating profit
conversion costs to redesign all LVDT estimated compliance date. scenario.
transformers and approximately $37.2 TSL 5 would set the energy
million in capital conversion costs as conservation standard at EL 5, max-tech, Medium-Voltage Dry-Type Distribution
almost all LVDT distribution for all LVDT distribution transformers. Transformers
TABLE V.50—MANUFACTURER IMPACT ANALYSIS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS—

PRESERVATION OF GROSS MARGIN PERCENTAGE MARKUP SCENARIO
Units standards
case 1 2 3 4 5
INPV ............................................. 2021$ millions ............................... 87 85 86 80 80 82

% ................................................... ................ (2.1) (0.9) (8.8) (7.8) (5.9)
* Numbers in parentheses ‘‘()’’ are negative. Some numbers might not round due to rounding.

PRESERVATION OF OPERATING PROFIT SCENARIO
Units standards
case 1 2 3 4 5
INPV ............................................. 2021$ millions ............................... 87 85 85 71 69 65

% ................................................... ................ (2.1) (3.0) (18.7) (21.4) (25.9)

PRESERVATION OF OPERATING PROFIT SCENARIO—Continued
Units standards
case 1 2 3 4 5
At TSL 1, DOE estimates the impacts TSL 2 would set the energy standards in the no-new-standards case
on INPV for MVDT distribution conservation standard at EL 2 for all in 2027. DOE estimates MVDT
transformer manufacturers to range from MVDT distribution transformers. DOE distribution transformer manufacturers
¥$1.9 million to ¥$1.8 million, which estimates that approximately 4.2 percent would spend approximately $6.0
corresponds to a change in INPV of of shipments would meet or exceed million in product conversion costs to
approximately –2.1 percent in both these energy conservation standards in redesign all MVDT distribution
cases. At TSL 1, industry free cash flow the no-new-standards case in 2027. DOE transformers and approximately $11.9
is estimated to decrease by estimates MVDT distribution million in capital conversion costs as
approximately 15.7 percent to $5.9 transformer manufacturers would spend many MVDT distribution transformer
million, compared to the no-new- approximately $3.1 million in product cores manufactured are expected to use
standard case value of $7.0 million in conversion costs to redesign amorphous steel.
2026, the year before the estimated transformers but would not have to
compliance date. make significant investments in capital At TSL 3, the shipment-weighted
TSL 1 would set the energy conversion costs as no MVDT average MPC for MVDT distribution
conservation standard at EL 1 for all distribution transformer cores are transformers increases by 14.5 percent
MVDT distribution transformers. DOE expected to use amorphous steel. relative to the no-new-standards case
estimates that approximately 21.2 At TSL 2, the shipment-weighted shipment-weighted average MPC in
percent of shipments would meet or average MPC for MVDT distribution 2027. The moderate increase in
exceed these energy conservation transformers increases by 3.2 percent shipment-weighted average MPC is
standards in the no-new-standards case relative to the no-new-standards case outweighed by the $17.9 million in
in 2027. DOE estimates MVDT shipment-weighted average MPC in conversion costs, causing a negative
distribution transformer manufacturers 2027. The increase in shipment- change in INPV at TSL 3 under the
would spend approximately $3.1 weighted average MPC is outweighed by preservation of gross margin percentage
million in product conversion costs to the $3.1 million in conversion costs, scenario.
redesign transformers but would not causing a negative change in INPV at
TSL 2 under the preservation of gross Under the preservation of operating
have to make significant investments in
capital conversion costs as no MVDT margin percentage scenario. profit scenario, the 14.5 percent
distribution transformer cores are Under the preservation of operating shipment-weighted average MPC
expected to use amorphous steel. profit scenario, the 3.2 percent increase results in a reduction in the
At TSL 1, the shipment-weighted shipment-weighted average MPC margin after the analyzed compliance
average MPC for MVDT distribution increase results in a reduction in the year. This reduction in the margin and
transformers does not increases relative margin after the analyzed compliance the $17.9 million in conversion costs
to the no-new-standards case shipment- year. This reduction in the margin and incurred by manufacturers cause a
weighted average MPC in 2027. The the $3.1 million in conversion costs negative change in INPV at TSL 3 under
preservation of gross margin percentage incurred by manufacturers cause a the preservation of operating profit
scenario produces similar INPV results negative change in INPV at TSL 2 under scenario.
as the preservation of operating profit the preservation of operating profit At TSL 4, DOE estimates the impacts
scenario due to the negligible change in scenario. on INPV for MVDT distribution
MPC at TSL 1. The change in INPV is At TSL 3, DOE estimates the impacts transformer manufacturers to range from
almost exclusively driven by the $3.1 on INPV for MVDT distribution ¥$18.7 million to ¥$6.8 million,
million in conversion costs, causing a transformer manufacturers to range from corresponding to a change in INPV of
negative change in INPV at TSL 1 under ¥$16.3 million to ¥$7.7 million, ¥21.4 percent to ¥7.8 percent. At TSL
both scenarios. corresponding to a change in INPV of
4, industry free cash flow is estimated
At TSL 2, DOE estimates the impacts ¥18.7 percent to ¥8.8 percent. At TSL
to decrease by approximately 115.3
on INPV for MVDT distribution 3, industry free cash flow is estimated
percent to ¥$1.1 million, compared to
transformer manufacturers to range from to decrease by approximately 107.1
percent to ¥$0.5 million, compared to the no-new-standard case value of $7.0
¥$2.7 million to ¥$0.8 million,
corresponding to a change in INPV of the no-new-standard case value of $7.0 million in 2026, the year before the
¥3.0 percent to ¥0.9 percent. At TSL million in 2026, the year before the estimated compliance date.
2, industry free cash flow is estimated estimated compliance date. TSL 4 would set the energy
to decrease by approximately 15.7 TSL 3 would set the energy conservation standard at EL 4 for all
percent to $5.9 million, compared to the conservation standard at EL 3 for all MVDT distribution transformers. DOE
no-new-standard case value of $7.0 MVDT distribution transformers. DOE estimates that no shipments would meet
million in 2026, the year before the estimates that no shipments would meet these energy conservation standards in
estimated compliance date. or exceed these energy conservation
the no-new-standards case in 2027. DOE standards at TSL 5. DOE estimates such as materials handling tasks using
estimates MVDT distribution MVDT distribution transformer forklifts, are included as production
transformer manufacturers would spend manufacturers would spend labor, as well as line supervisors.
approximately $6.1 million in product approximately $6.2 million in product DOE used the GRIM to calculate the
conversion costs to redesign all MVDT conversion costs to redesign all MVDT number of production employees from
distribution transformers and distribution transformers and labor expenditures. DOE used statistical
approximately $13.1 million in capital approximately $15.1 million in capital data from the U.S. Census Bureau’s 2019
conversion costs as most MVDT conversion costs as all MVDT Annual Survey of Manufacturers
distribution transformer cores distribution transformer cores (‘‘ASM’’) and the results of the
manufactured are expected to use manufactured are expected to use engineering analysis to calculate
amorphous steel. amorphous steel. industry-wide labor expenditures. Labor
At TSL 4, the shipment-weighted At TSL 5, the shipment-weighted expenditures related to equipment
average MPC for MVDT distribution average MPC for MVDT distribution manufacturing depend on the labor
transformers increases by 20.0 percent transformers increases by 29.4 percent intensity of the product, the sales
relative to the no-new-standards case relative to the no-new-standards case volume, and an assumption that wages
shipment-weighted average MPC in shipment-weighted average MPC in remain fixed in real terms over time.
2027. The significant increase in 2027. The significant increase in The total labor expenditures in the
shipment-weighted average MPC is shipment-weighted average MPC is GRIM were then converted to domestic
outweighed by the $19.2 million in outweighed by the $21.2 million in
production employment levels by
conversion costs, causing a negative conversion costs, causing a negative
dividing production labor expenditures
change in INPV at TSL 4 under the change in INPV at TSL 5 under the
by the annual payment per production
preservation of gross margin percentage preservation of gross margin percentage
worker.
scenario. scenario.
Under the preservation of operating Non-production employees account
Under the preservation of operating for those workers that are not directly
profit scenario, the 29.4 percent
profit scenario, the 20.0 percent engaged in the manufacturing of the
shipment-weighted average MPC
shipment-weighted average MPC covered equipment. This could include
increase results in a reduction in the
increase results in a reduction in the sales, human resources, engineering,
margin after the analyzed compliance
margin after the analyzed compliance and management. DOE estimated non-
year. This reduction in the margin and
year. This reduction in the margin and production employment levels by
the $21.2 million in conversion costs
the $19.2 million in conversion costs multiplying the number of distribution
incurred by manufacturers cause a
incurred by manufacturers cause a transformer workers by a scaling factor.
negative change in INPV at TSL 5 under
negative change in INPV at TSL 4 under The scaling factor is calculated by
the preservation of operating profit
the preservation of operating profit taking the ratio of the total number of
scenario.
scenario. employees, and the total production
At TSL 5, DOE estimates the impacts b. Direct Impacts on Employment workers associated with the industry
on INPV for MVDT distribution To quantitatively assess the potential NAICS code 335311, which covers
transformer manufacturers to range from impacts of amended energy power, distribution, and specialty
¥$22.6 million to ¥$5.2 million, conservation standards on direct transformer manufacturing.
corresponding to a change in INPV of employment in the distribution Using data from manufacturer
–25.9 percent to ¥5.9 percent. At TSL transformers industry, DOE used the interviews and estimated market share
5, industry free cash flow is estimated GRIM to estimate the domestic labor data, DOE estimates that approximately
to decrease by approximately 128.4 expenditures and number of direct 85 percent of all liquid-immersed
percent to ¥$2.0 million, compared to employees in the no-new-standards case distribution transformer manufacturing;
the no-new-standard case value of $7.0 and in each of the standards cases 15 percent of all LVDT distribution
million in 2026, the year before the (TSLs) during the analysis period. transformer manufacturing; and 75
estimated compliance date. Production employees are those who
percent of all MVDT distribution
TSL 5 would set the energy are directly involved in fabricating and
transformer manufacturing takes place
conservation standard at EL 5, max-tech, assembling equipment within a
domestically.
for all MVDT distribution transformers. manufacturer facility. Workers
DOE estimates that no shipments would performing services that are closely Liquid-Immersed Distribution
meet these energy conservation associated with production operations, Transformers
TABLE V.52—DOMESTIC EMPLOYMENT FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS IN 2027

standards
case 1 2 3 4 5
Domestic Production Workers in 2027 .... 5,164 5,193 5,251 5,453 5,624 6,885
Domestic Non-Production Workers in
2027 ...................................................... 1,830 1,840 1,861 1,932 1,993 2,440
Total Direct Employment in 2027 ..... 6,994 7,033 7,112 7,385 7,617 9,325
Potential Changes in Total Direct Em-
ployment in 2027 .................................. ........................ (874)–39 (1,180)–118 (1,506)–391 (1,549)–623 (1,549)–2,331
Using the estimated labor content from the 2019 ASM, DOE estimates that domestic production workers, and 1,830
from the GRIM combined with data there would be approximately 5,164 domestic non-production workers
involved in liquid-immersed increases, which causes the number of to either make the substantial
distribution transformer manufacturing direct employees to also increase. The investments to add or increase their
in 2027 in the absence of amended lower range of the ‘‘Potential Change in own amorphous core production
energy conservation standards. Table Total Direct Employment in 2027’’ capabilities and continue to
V.52 shows the range of the impacts of displayed in Table V.52, assumes that as manufacturer their own cores in-house;
energy conservation standards on U.S. more amorphous cores are used to meet outsource their amorphous core
production on liquid-immersed higher energy conservation standards, production to another distribution core
distribution transformers. either the amorphous core production is manufacturer, which may or may not be
Amorphous core production is more out-sourced to core only manufacturers located in the U.S.; or re-locate some or
labor intensive and would require all of their distribution transformer
(manufacturers that specialize in
additional labor expenditures. The manufacturing to a foreign country. DOE
manufacturing cores used in
upper range of the ‘‘Potential Change in acknowledges there is a wide range of
Total Direct Employment in 2027’’ distribution transformers, but do not
actually manufacture entire distribution potential domestic employment impacts
displayed in Table V.52, assumes that due to energy conservation standards,
all domestic liquid-immersed transformers) which may be located in
foreign countries, or distribution especially at the higher TSLs. The
distribution transformer manufacturing ranges in potential employment impacts
remains in the U.S. For this scenario, transformer manufacturing is re-located
to foreign countries. This lower range displayed in Table V.52 at each TSL
the additional labor expenditures attempt to provide a reasonable upper
associated with amorphous core assumes that 30 percent of distribution
transformers using amorphous cores are and lower bound to how liquid-
production result in the number of total immersed distribution transformer
direct employees to increase due to re-located to foreign countries due to the
manufacturers may respond to potential
energy conservation standards. At energy conservation standard. DOE
energy conservation standards.
higher TSLs, the estimated number of acknowledges that each distribution
amorphous cores used in liquid- transformer manufacturer would Low-Voltage Dry-Type Distribution
immersed distribution transformers individually make a business decision Transformers
TABLE V.53—DOMESTIC EMPLOYMENT FOR LOW-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS IN 2027

standards
case 1 2 3 4 5
Domestic Production Workers in 2027 .... 169 169 170 183 201 208
2027 ...................................................... 60 60 60 65 71 74
Total Direct Employment in 2027 ..... 229 229 230 248 272 282
ployment in 2027 .................................. ........................ 0 0–1 (28)–19 (49)–43 (51)–53
Using the estimated labor content production on LVDT distribution Total Direct Employment in 2027’’,
from the GRIM combined with data transformers. assumes that 30 percent of distribution
from the 2019 ASM, DOE estimates that DOE used the same methodology to transformers using amorphous cores are
there would be approximately 169 estimate the potential impacts to re-located to foreign countries, either
domestic production workers, and 60 domestic employment for LVDT due to amorphous core production that
domestic non-production workers distribution transformer manufacturing is outsourced to core only
involved in LVDT distribution that was used for liquid-immersed manufacturers located in foreign
transformer manufacturing in 2027 in distribution transformer manufacturing. countries or LVDT distribution
The upper range of the ‘‘Potential transformer manufacturers re-locating
the absence of amended energy
Change in Total Direct Employment in their distribution transformer
conservation standards. Table V.53
2027’’ displayed in Table V.53, assumes production to foreign countries.
shows the range of the impacts of energy that all LVDT distribution transformer
conservation standards on U.S. manufacturing remains in the U.S. The Medium-Voltage Dry-Type Distribution
lower range of the ‘‘Potential Change in Transformers
TABLE V.54—DOMESTIC EMPLOYMENT FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS IN 2027
No-new-stand-
ards case 1 2 3 4 5
Domestic Production Workers in 2027 .... 275 275 284 315 330 356
2027 ...................................................... 98 98 101 112 117 126
Total Direct Employment in 2027 ..... 373 373 385 427 447 482
ployment in 2027 .................................. ........................ 0 0–12 (63)–54 (69)–74 (83)–109
Using the estimated labor content used in all or even most distribution transformer manufacturers, LVDT
from the GRIM combined with data transformers currently sold in the U.S. distribution transformer manufacturers,
from the 2019 ASM, DOE estimates that Other distribution transformer MVDT distribution transformer
there would be approximately 275 manufacturers and steel suppliers manufacturers, small businesses, and
domestic production workers, and 98 interviewed stated that, while the steel suppliers. During these
domestic non-production workers current capacity of amorphous steel manufacturer interviews DOE asked
involved in MVDT distribution does not exist to supply the majority of manufacturers if energy conservation
transformer manufacturing in 2027 in the steel used in distribution standards could result in a change in
the absence of amended energy transformer cores, steel manufacturers industry competition. Some
conservation standards. Table V.54 are capable of significantly increasing manufacturers stated that there is a
shows the range of the impacts of energy their amorphous steel production if possibility that smaller manufacturers
conservation standards on U.S. there is sufficient market demand for may exit the market or their market
production on MVDT distribution amorphous steel. share may decrease, if these businesses
transformers. While the availability of both GOES are not able to make the investments to
DOE used the same methodology to and amorphous steel is a concern for upgrade their production equipment or
estimate the potential impacts to many distribution transformer to create new equipment designs in
domestic employment for MVDT manufacturers, steel suppliers should be order to comply with energy
distribution transformer manufacturing able to meet the market demand for conservation standards. See section
that was used for liquid-immersed amorphous steel for all TSLs analyzed VI.B, for a complete discussion on the
distribution transformer manufacturing. given the three-year compliance period potential impacts to small businesses.
The upper range of the ‘‘Potential for distribution transformers. Steel Based on the market and technology
Change in Total Direct Employment in manufacturers should be able to assessment conducted for this NOPR
2027’’ displayed in Table V.54, assumes significantly increase their supply of analysis, DOE identified 29
that all MVDT distribution transformer amorphous steel if they know there will manufacturers of distribution
manufacturing remains in the U.S. The be an increase in the demand for this transformers covered by this
lower range of the ‘‘Potential Change in material due to energy conservation rulemaking. See chapter 3 of this NOPR
Total Direct Employment in 2027’’, standards for distribution transformers. TSD for a complete list of the
assumes that 30 percent of distribution See section V.C for a more detailed distribution transformer manufacturers.
transformers using amorphous cores are discussion of the global supply of steel. The distribution transformer market has
re-located to foreign countries, either DOE requests comment on the a handful of major manufacturers for
due to amorphous core production that potential availability of either each equipment type (i.e., liquid-
is outsourced to core only amorphous steel, grain-oriented immersed, LVDT, MVDT). Transformer
manufacturers located in foreign electrical steel, or any other materials core sourcing is a major driver of
countries or MVDT distribution that may be needed to meet any of the transformer manufacturing strategy and
transformer manufacturers re-locating analyzed energy conservation standards competitiveness which may be
their distribution transformer in this rulemaking. More specifically, impacted by the standards level.
production to foreign countries. DOE requests comment on steel Typically, manufacturers with larger
DOE requests comment on the manufacturers’ ability to increase market shares produce most of their
estimated potential domestic supply of amorphous steel in reaction to own cores and manufacturers with
employment impacts on distribution increased demand for amorphous steel smaller market shares purchase the
transformer manufacturers presented in as a result of increased energy cores used in their distribution
this NOPR. conservation standards for distribution transformers. The Department does not
transformers. believe the proposed standard will alter
c. Impacts on Manufacturing Capacity
current core make-versus-buy decisions.
The prices of raw materials currently d. Impacts on Competition
The Department expects that
used in distribution transformers, such EPCA directs DOE to consider any manufacturers with larger market shares
as GOES, copper, and aluminum, have lessening of competition that is likely to will make the large investments needed
all experienced a significant increase in result from imposition of standards. It to convert their core production to
price starting at the beginning of 2021. further directs the Attorney General to amorphous steel. Manufacturers with
The availability of these commodities determine the impacts, if any, of any smaller market shares that do not invest
remains a significant concern with lessening of competition. The in amorphous core manufacturing will
distribution transformer manufacturers. competitive analysis includes an continue to have the option to source
As previously stated in IV.J.3.a, steel assessment of the impacts to smaller, yet their cores. DOE does not anticipate a
producers are shifting production away significant, manufacturers. DOE bases significant change in competition due to
from GOES suited for distribution its assessment on manufacturing cost energy conservation standards as the
transformer core manufacturing to non- data and on information collected from business model and competitive
grain-oriented steels suited for electric interviews with manufacturers. The position for most distribution
vehicle production. However, manufacturer interviews focus on transformer manufacturers will remain
amorphous steel has not seen the same gathering information that would help the same after compliance with energy
significant increase in price as GOES in assessing asymmetrical cost increases conservation standards.
since the beginning of 2021. to some manufacturers, increased
The availability of amorphous steel is e. Impacts on Subgroups of
proportion of fixed costs potentially

a concern for many distribution increasing business risks, and potential Manufacturers
transformer manufacturers. Based on barriers to market entry (e.g., proprietary As discussed in section IV.J.1 of this
information received during technologies). document, using average cost
manufacturer interviews some As discussed in section IV.J.3, DOE assumptions to develop an industry
distribution transformer manufacturers interviewed a wide variety of cash-flow estimate may not be adequate
suggested that there would not be distribution transformer manufacturers, for assessing differential impacts among
enough amorphous steel available to be including liquid-immersed distribution manufacturer subgroups. Small
manufacturers, niche manufacturers, distribution transformer manufacturer burden. In addition to energy

and manufacturers exhibiting a cost and its affiliates may employ a conservation standards, other
structure substantially different from the maximum of 750 employees. The 750- regulations can significantly affect
industry average could be affected employee threshold includes all manufacturers’ financial operations.
disproportionately. DOE used the employees in a business’s parent Multiple regulations affecting the same
results of the industry characterization company and any other subsidiaries. manufacturer can strain profits and lead
to group manufacturers exhibiting For a discussion of the impacts on the companies to abandon product lines or
similar characteristics. Consequently, small manufacturer subgroup, see the markets with lower expected future
DOE considered four manufacturer Regulatory Flexibility Analysis in returns than competing products. For
subgroups in the MIA: liquid-immersed, section VI.B. these reasons, DOE conducts an analysis
LVDT, MVDT, and small manufacturers of cumulative regulatory burden as part
f. Cumulative Regulatory Burden
as a subgroup for a separate impact of its rulemakings pertaining to
analysis. DOE discussed the potential One aspect of assessing manufacturer
appliance efficiency. DOE requests
impacts on liquid-immersed, LVDT, and burden involves looking at the
information regarding the impact of
MVDT distribution transformer cumulative impact of multiple DOE
cumulative regulatory burden on
manufacturers separately in sections standards and the product-specific
regulatory actions of other Federal manufacturers of distribution
V.B.2.a and V.B.2.b. transformers associated with multiple
For the small business subgroup agencies that affect the manufacturers of
a covered product or equipment. While DOE standards or product-specific
analysis, DOE applied the small
any one regulation may not impose a regulatory actions of other Federal
business size standards published by
significant burden on manufacturers, agencies.
the Small Business Administration
(‘‘SBA’’) to determine whether a the combined effects of several existing DOE evaluates product-specific
company is considered a small business. or impending regulations may have regulations that will take effect
The size standards are codified at 13 serious consequences for some approximately 3 years before or after the
CFR part 121. To be categorized as a manufacturers, groups of manufacturers, estimated 2027 compliance date of any
small business under NAICS code or an entire industry. Assessing the amended energy conservation standards
335311, ‘‘power, distribution, and impact of a single regulation may for distribution transformers. This
specialty transformer manufacturing,’’ a overlook this cumulative regulatory information is presented in Table V.55.
TABLE V.55—COMPLIANCE DATES AND EXPECTED CONVERSION EXPENSES OF FEDERAL ENERGY CONSERVATION
STANDARDS AFFECTING DISTRIBUTION TRANSFORMER MANUFACTURERS
Number of Industry Industry
Number of manufacturers Approx. conversion conversion
Federal energy conservation standard manufacturers * affected from standards year costs costs/product
this rule ** (millions) revenue ***
Dedicated-Purpose Pool Pump Motors, 87 FR 37122

(June 21, 2022) ............................................................ 5 1 2026 $46.2 2.8%
(2020$)
* This column presents the total number of manufacturers identified in the energy conservation standard rule contributing to cumulative regu-
latory burden.
** This column presents the number of manufacturers producing distribution transformers that are also listed as manufacturers in the listed en-
ergy conservation standard contributing to cumulative regulatory burden.
*** This column presents industry conversion costs as a percentage of product 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 the 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.
In addition to the rulemaking listed in dishwashers; 108 dehumidifiers; 109 regulatory burden for the distribution
Table V.55, DOE has ongoing miscellaneous refrigeration products; 110 transformers final rule.
rulemakings for other products or and residential clothes washers.111 If 3. National Impact Analysis
equipment that distribution transformer DOE proposes or finalizes any energy
manufacturers produce, including conservation standards for these This section presents DOE’s estimates
battery chargers; 103 external power products or equipment prior to of the national energy savings and the
supplies; 104 ceiling fan light kits; 105 finalizing energy conservation standards NPV of consumer benefits that would
electric motors; 106 residential for distribution transformers, DOE will result from each of the TSLs considered
conventional cooking products; 107 include the energy conservation as potential amended standards.
standards for these other products or a. Significance of Energy Savings
103 www.regulations.gov/docket/EERE-2008-BT-
equipment as part of the cumulative
To estimate the energy savings
STD-0005.
attributable to potential amended
104 www.regulations.gov/docket/EERE-2020-BT- 108 www.regulations.gov/docket/EERE-2019-BT-
STD-0006. STD-0039.
standards for distribution transformers,
105 www.regulations.gov/docket/EERE-2019-BT- 109 www.regulations.gov/docket/EERE-2019-BT- DOE compared their energy
STD-0040. STD-0043. consumption under the no-new-
106 www.regulations.gov/docket/EERE-2020-BT- 110 www.regulations.gov/docket/EERE-2020-BT- standards case to their anticipated
STD-0007. STD-0039. energy consumption under each TSL.
107 www.regulations.gov/docket/EERE-2014-BT- 111 www.regulations.gov/docket/EERE-2017-BT- The savings are measured over the
STD-0005. STD-0014. entire lifetime of products purchased in
the 30-year period that begins in the TSL considered for distribution savings were calculated using the
first full year of anticipated compliance transformers, the results showing DOE’s approach described in section IV.H of
with amended standards (2027–2056). proposed standard are in bold. Savings this document.
Table V.56 presents DOE’s projections are reported for each of the equipment
of the national energy savings for each classes as defined in Section IV.A.2. The
TABLE V.56—CUMULATIVE NATIONAL ENERGY SOURCES FOR DISTRIBUTION TRANSFORMERS BY EQUIPMENT CLASS; 30
YEARS OF SHIPMENT, (2027–2056)
Standard level
1 2 3 4 5
Primary Energy Savings (Quads)
Liquid-Immersed:
Equipment Class 1 ....................................................... 2.16 3.16 4.45 4.75 4.89
Equipment Class 2 ....................................................... 0.91 1.65 2.63 2.97 3.17
Equipment Class 12 ..................................................... n.a. n.a. n.a. n.a. 0.08
Liquid-Immersed Total ........................................... 3.06 4.80 7.09 7.72 8.14
Low-Voltage Dry-Type:
Equipment Class 3 ....................................................... 0.02 0.03 0.05 0.09 0.12
Equipment Class 4 ....................................................... 0.34 0.48 0.77 2.10 2.25
Low-Voltage Dry-Type Total .................................. 0.35 0.52 0.82 2.19 2.37
Medium-Voltage Dry-Type:
Equipment Class 5 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 6 ....................................................... 0.00 0.00 0.01 0.02 0.03
Equipment Class 7 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 8 ....................................................... 0.05 0.07 0.23 0.29 0.35
Equipment Class 9 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 10 ..................................................... 0.02 0.04 0.14 0.19 0.22
Medium-Voltage Dry-Type Total ........................... 0.08 0.11 0.39 0.51 0.61
FFC Energy Savings (Quads)
Liquid-Immersed:
Equipment Class 1 ....................................................... 2.24 3.28 4.63 4.94 5.08
Equipment Class 2 ....................................................... 0.94 1.71 2.73 3.08 3.29
Equipment Class 12 ..................................................... 0.00 0.00 0.00 0.00 0.09
Equipment Class 3 ....................................................... 0.02 0.03 0.05 0.09 0.12
Equipment Class 4 ....................................................... 0.35 0.50 0.80 2.19 2.34
Equipment Class 5 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 6 ....................................................... 0.00 0.00 0.01 0.02 0.03
Equipment Class 7 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 8 ....................................................... 0.05 0.07 0.24 0.30 0.36
Equipment Class 9 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 10 ..................................................... 0.02 0.04 0.15 0.20 0.23
OMB Circular A–4 112 requires costs. Circular A–4 also directs agencies revision of and compliance with such
agencies to present analytical results, to consider the variability of key revised standards.113 The review
including separate schedules of the elements underlying the estimates of
monetized benefits and costs that show benefits and costs. For this rulemaking, 113 Section 325(m) of EPCA requires DOE to
the type and timing of benefits and review its standards at least once every 6 years, and
DOE undertook a sensitivity analysis requires, for certain products, a 3-year period after
using 9 years, rather than 30 years, of any new standard is promulgated before
112 U.S. Office of Management and Budget.
product shipments. The choice of a 9- compliance is required, except that in no case may
Circular A–4: Regulatory Analysis. September 17, any new standards be required within 6 years of the
2003. https://www.whitehouse.gov/wp-content/
year period is a proxy for the timeline compliance date of the previous standards. While
uploads/legacy_drupal_files/omb/circulars/A4/a- in EPCA for the review of certain energy adding a 6-year review to the 3-year compliance
4.pdf (last accessed August 26, 2022). conservation standards and potential Continued
timeframe established in EPCA is purposes only and are not indicative of lifetime of distribution transformers
generally not synchronized with the any change in DOE’s analytical purchased in 2027–2036, the results
product lifetime, product manufacturing methodology. The NES sensitivity showing DOE’s proposed standard are
cycles, or other factors specific to analysis results based on a 9-year in bold.
distribution transformers. Thus, such analytical period are presented in Table
results are presented for informational V.57. The impacts are counted over the
TABLE V.57—CUMULATIVE NATIONAL ENERGY SAVINGS FOR DISTRIBUTION TRANSFORMERS; 9 YEARS OF SHIPMENTS,
(2027–2036)
Standard level
1 2 3 4 5
Primary Energy Savings (Quads)
Liquid-Immersed:
Equipment Class 1 ....................................................... 0.62 0.90 1.27 1.36 1.39
Equipment Class 2 ....................................................... 0.26 0.47 0.75 0.85 0.90
Equipment Class 12 ..................................................... n.a. n.a. n.a. n.a. 0.02

Equipment Class 3 ....................................................... 0.00 0.01 0.01 0.02 0.03
Equipment Class 4 ....................................................... 0.10 0.14 0.22 0.60 0.64

Equipment Class 5 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 6 ....................................................... 0.00 0.00 0.00 0.01 0.01
Equipment Class 7 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 8 ....................................................... 0.01 0.02 0.07 0.08 0.10
Equipment Class 9 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 10 ..................................................... 0.01 0.01 0.04 0.05 0.06
FFC Energy Savings (Quads)
Liquid-Immersed:
Equipment Class 1 ............................................................... 0.64 0.93 1.32 1.41 1.45
Equipment Class 2 ............................................................... 0.27 0.49 0.78 0.88 0.94
Equipment Class 12 ............................................................. n.a. n.a. n.a. n.a. 0.03

Equipment Class 3 ....................................................... 0.00 0.01 0.01 0.03 0.04
Equipment Class 4 ....................................................... 0.10 0.14 0.23 0.62 0.67

Equipment Class 5 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 6 ....................................................... 0.00 0.00 0.00 0.01 0.01
Equipment Class 7 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 8 ....................................................... 0.02 0.02 0.07 0.09 0.10
Equipment Class 9 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 10 ..................................................... 0.01 0.01 0.04 0.06 0.07
b. Net Present Value of Consumer Costs TSLs considered for distribution rate. Table V.58 shows the consumer
and Benefits transformers. In accordance with OMB’s NPV results with impacts counted over
DOE estimated the cumulative NPV of guidelines on regulatory analysis,114 the lifetime of products purchased in
the total costs and savings for DOE calculated NPV using both a 7- 2027–2056, the results showing DOE’s
consumers that would result from the percent and a 3-percent real discount proposed standard are in bold.
period adds up to 9 years, DOE notes that it may period may not be appropriate given the variability 114 U.S. Office of Management and Budget.
undertake reviews at any time within the 6 year that occurs in the timing of standards reviews and Circular A–4: Regulatory Analysis. September 17,
period and that the 3-year compliance date may the fact that for some products, the compliance 2003. www.whitehouse.gov/omb/circulars_a004_a-
yield to the 6-year backstop. A 9-year analysis period is 5 years rather than 3 years. 4/ (last accessed April 15, 2022).
TABLE V.58—CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS FOR DISTRIBUTION TRANSFORMERS; 30 YEARS
OF SHIPMENTS, BILLION 2021$, (2027–2056)
Standard level
1 2 3 4 5
3 percent Discount Rate
Liquid-Immersed:
Equipment Class 1 ....................................................... 2.55 3.34 4.00 3.45 ¥4.04
Equipment Class 2 ....................................................... 0.43 0.81 1.50 1.84 ¥2.10
Equipment Class 12 ..................................................... n.a. n.a. n.a. n.a. ¥0.10
Liquid-Immersed Total ........................................... 2.98 4.15 5.50 5.30 ¥6.25
Equipment Class 3 ....................................................... 0.07 0.13 0.15 0.31 0.52
Equipment Class 4 ....................................................... 1.41 1.98 1.72 9.41 9.11
Equipment Class 5 ....................................................... 0.00 0.00 0.00 0.00 0.01
Equipment Class 6 ....................................................... 0.01 0.01 0.02 0.02 0.04
Equipment Class 7 ....................................................... 0.00 0.00 0.00 0.01 0.01
Equipment Class 8 ....................................................... 0.25 0.22 0.76 0.77 0.54
Equipment Class 9 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 10 ..................................................... 0.00 ¥0.02 0.46 0.50 0.36
Liquid-Immersed:
Equipment Class 1 ....................................................... 0.78 0.94 0.82 0.24 ¥4.41
Equipment Class 2 ....................................................... 0.00 0.06 0.07 0.01 ¥2.60
Equipment Class 3 ....................................................... 0.02 0.04 0.04 0.07 0.13
Equipment Class 4 ....................................................... 0.50 0.70 0.35 2.72 2.50
Equipment Class 5 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 6 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 7 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 8 ....................................................... 0.10 0.07 0.18 0.15 0.01
Equipment Class 9 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 10 ..................................................... 0.01 ¥0.04 0.08 0.08 0.00
The NPV results based on the products purchased in 2027–2036. As change in DOE’s analytical methodology
aforementioned 9-year analytical period mentioned previously, such results are or decision criteria.
are presented in Table V.59. The presented for informational purposes
impacts are counted over the lifetime of only and are not indicative of any
OF SHIPMENTS, BILLION 2021$, (2027–2036)
Standard level
1 2 3 4 5
Liquid-Immersed:
Equipment Class 1 ....................................................... 0.99 1.30 1.56 1.36 ¥1.50
Equipment Class 2 ....................................................... 0.17 0.32 0.59 0.73 ¥0.78
OF SHIPMENTS, BILLION 2021$, (2027–2036)—Continued
Standard level
1 2 3 4 5
Equipment Class 3 ....................................................... 0.03 0.05 0.06 0.12 0.20
Equipment Class 4 ....................................................... 0.55 0.77 0.68 3.69 3.57

Equipment Class 5 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 6 ....................................................... 0.00 0.00 0.01 0.01 0.02
Equipment Class 7 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 8 ....................................................... 0.10 0.09 0.30 0.30 0.22
Equipment Class 9 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 10 ..................................................... 0.00 ¥0.01 0.18 0.20 0.15
Liquid-Immersed:
Equipment Class 1 ....................................................... 0.40 0.49 0.43 0.14 ¥2.24
Equipment Class 2 ....................................................... 0.00 0.03 0.04 0.02 ¥1.32

Equipment Class 3 ....................................................... 0.01 0.02 0.02 0.04 0.07
Equipment Class 4 ....................................................... 0.26 0.36 0.19 1.43 1.32
Equipment Class 5 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 6 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 7 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 8 ....................................................... 0.05 0.04 0.10 0.08 0.01
Equipment Class 9 ....................................................... 0.00 0.00 0.00 0.00 0.00
Equipment Class 10 ..................................................... ¥0.01 ¥0.02 0.05 0.04 0.00
The previous results reflect the use of distribution transformers would reduce labor in the economy. The net change in
a default trend to estimate the change in energy expenditures for consumers of jobs is so small that it would be
price for distribution transformers over those products, with the resulting net imperceptible in national labor statistics
the analysis period (see section IV.F.1 of savings being redirected to other forms and might be offset by other,
this document). DOE also conducted a of economic activity. These expected unanticipated effects on employment.
sensitivity analysis that considered one shifts in spending and economic activity Chapter 16 of the NOPR TSD presents
scenario with a lower rate of price could affect the demand for labor. As detailed results regarding anticipated
decline than the reference case and one described in section IV.N of this indirect employment impacts.
scenario with a higher rate of price document, DOE used an input/output
decline than the reference case. The model of the U.S. economy to estimate 4. Impact on Utility or Performance of
results of these alternative cases are indirect employment impacts of the Products
presented in appendix 10C of the NOPR TSLs that DOE considered. There are
TSD. In the high-price-decline case, the uncertainties involved in projecting As discussed in section IV.C.1.b of
NPV of consumer benefits is higher than employment impacts, especially this document, DOE has tentatively
in the default case. In the low-price- changes in the later years of the concluded that the standards proposed
decline case, the NPV of consumer analysis. Therefore, DOE generated in this NOPR would not lessen the
benefits is lower than in the default results for near-term timeframes (2027– utility or performance of the
case. 2031), where these uncertainties are distribution transformers under
reduced. consideration in this rulemaking.
c. Indirect Impacts on Employment Manufacturers of these products
The results suggest that the proposed
It is estimated that that amended standards would be likely to have a currently offer units that meet or exceed
energy conservation standards for negligible impact on the net demand for the proposed standards.
5. Impact of Any Lessening of DOJ with copies of this NOPR and the also likely to reduce the cost of
Competition accompanying TSD for review. DOE will maintaining the reliability of the
DOE considered any lessening of consider DOJ’s comments on the electricity system, particularly during
competition that would be likely to proposed rule in determining whether peak-load periods. Chapter 15 in the
result from new or amended standards. to proceed to a final rule. DOE will NOPR TSD presents the estimated
As part of this consideration, DOE publish and respond to DOJ’s comments impacts on electricity generating
weighed the effects on markets for both in that document. DOE invites comment capacity, relative to the no-new-
component parts (see IV.C.3.a) and from the public regarding the standards case, for the TSLs that DOE
distribution transformer equipment (see competitive impacts that are likely to considered in this rulemaking.
IV.A.6). DOE’s preliminary finding is result from this proposed rule. In
addition, stakeholders may also provide Energy conservation resulting from
that this rule, if finalized as proposed,
comments separately to DOJ regarding potential energy conservation standards
would not significantly affect
these potential impacts. See the for distribution transformers is expected
competition in the market for
distribution transformers. See section ADDRESSES section for information to to yield environmental benefits in the
V.B.5 for a complete discussion on send comments to DOJ. form of reduced emissions of certain air
industry competition. As discussed in pollutants and greenhouse gases. Table
6. Need of the Nation to Conserve V.60 through Table V.63 provides DOE’s
section III.E.1.e, the Attorney General Energy
determines the impact, if any, of any estimate of cumulative emissions
lessening of competition likely to result Enhanced energy efficiency, where reductions expected to result from the
from a proposed standard, and transmits economically justified, improves the TSLs considered in this rulemaking.
such determination in writing to the Nation’s energy security, strengthens the The emissions were calculated using the
Secretary, together with an analysis of economy, and reduces the multipliers discussed in section IV.K.
the nature and extent of such impact. To environmental impacts (costs) of energy DOE reports annual emissions
assist the Attorney General in making production. Reduced electricity demand reductions for each TSL in chapter 13 of
this determination, DOE has provided due to energy conservation standards is the NOPR TSD.
TABLE V.60—CUMULATIVE EMISSIONS REDUCTION FOR ALL DISTRIBUTION TRANSFORMERS SHIPPED IN 2027–2056 AT
PROPOSED STANDARD LEVELS
Power Sector Emissions
CO2 (million metric tons) ......................................................................................................................................................... 312.0

CH4 (thousand tons) ................................................................................................................................................................ 21.3
N2O (thousand tons) ................................................................................................................................................................ 2.9
NOX (thousand tons) ............................................................................................................................................................... 146.0
SO2 (thousand tons) ................................................................................................................................................................ 129.2
Hg (tons) .................................................................................................................................................................................. 0.8
Upstream Emissions

CH4 (thousand tons) ................................................................................................................................................................ 2419.9
N2O (thousand tons) ................................................................................................................................................................ 0.1
SO2 (thousand tons) ................................................................................................................................................................ 1.7
Hg (tons) .................................................................................................................................................................................. 0.0
Total FFC Emissions

CH4 (thousand tons) ................................................................................................................................................................ 2441.2
N2O (thousand tons) ................................................................................................................................................................ 3.0
SO2 (thousand tons) ................................................................................................................................................................ 130.9
Hg (tons) .................................................................................................................................................................................. 0.9
Negative values refer to an increase in emissions.
TABLE V.61—CUMULATIVE EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS FOR LIQUID-IMMERSED

DISTRIBUTION TRANSFORMERS SHIPPED IN 2027–2056
1 2 3 4 5
CO2 (million metric tons) ..................................................... 94.2 147.8 217.7 237.0 249.4
CH4 (thousand tons) ............................................................ 6.4 10.1 14.8 16.2 17.0
N2O (thousand tons) ............................................................ 0.9 1.4 2.0 2.2 2.3
NOX (thousand tons) ........................................................... 44.1 69.2 101.9 110.9 116.7
SO2 (thousand tons) ............................................................ 39.1 61.4 90.5 98.4 103.5
TABLE V.61—CUMULATIVE EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS FOR LIQUID-IMMERSED

DISTRIBUTION TRANSFORMERS SHIPPED IN 2027–2056—Continued
1 2 3 4 5
Hg (tons) .............................................................................. 0.3 0.4 0.6 0.6 0.7
Upstream Emissions
CH4 (thousand tons) ............................................................ 726.6 1139.8 1680.6 1830.4 1929.9
N2O (thousand tons) ............................................................ 0.0 0.1 0.1 0.1 0.1
SO2 (thousand tons) ............................................................ 0.5 0.8 1.2 1.3 1.3
Hg (tons) .............................................................................. 0.0 0.0 0.0 0.0 0.0
Total FFC Emissions
CH4 (thousand tons) ............................................................ 733.1 1149.8 1695.5 1846.6 1946.9
N2O (thousand tons) ............................................................ 0.9 1.4 2.1 2.3 2.4
SO2 (thousand tons) ............................................................ 39.7 62.2 91.6 99.7 104.8
Hg (tons) .............................................................................. 0.3 0.4 0.6 0.7 0.7
I I I
TABLE V.62—CUMULATIVE EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS FOR LOW-VOLTAGE DRY-TYPE
1 2 3 4 5
CH4 (thousand tons) ............................................................ 0.7 1.1 1.7 4.5 4.9
N2O (thousand tons) ............................................................ 0.1 0.1 0.2 0.6 0.7
SO2 (thousand tons) ............................................................ 4.4 6.4 10.2 27.1 29.4
Hg (tons) .............................................................................. 0.0 0.0 0.1 0.2 0.2
Upstream Emissions
CH4 (thousand tons) ............................................................ 84.0 122.4 194.5 519.1 562.4
N2O (thousand tons) ............................................................ 0.0 0.0 0.0 0.0 0.0
SO2 (thousand tons) ............................................................ 0.1 0.1 0.1 0.4 0.4
Hg (tons) .............................................................................. 0.0 0.0 0.0 0.0 0.0
Total FFC Emissions
CH4 (thousand tons) ............................................................ 84.8 123.4 196.2 523.5 567.3
N2O (thousand tons) ............................................................ 0.1 0.2 0.2 0.6 0.7
SO2 (thousand tons) ............................................................ 4.5 6.5 10.3 27.5 29.8
Hg (tons) ..............................................................................
I 0.0 0.0
I 0.1 0.2
I 0.2
TABLE V.63—CUMULATIVE EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS FOR MEDIUM-VOLTAGE DRY-TYPE
Trial Standard Level
1 2 3 4 5
CH4 (thousand tons) ............................................................ 0.2 0.2 0.8 1.0 1.2
N2O (thousand tons) ............................................................ 0.0 0.0 0.1 0.1 0.2
TABLE V.63—CUMULATIVE EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS FOR MEDIUM-VOLTAGE DRY-TYPE
DISTRIBUTION TRANSFORMERS SHIPPED IN 2027–2056—Continued
Trial Standard Level
1 2 3 4 5

SO2 (thousand tons) ............................................................ 1.0 1.4 4.8 6.2 7.5
Hg (tons) .............................................................................. 0.0 0.0 0.0 0.0 0.0
Upstream Emissions
CH4 (thousand tons) ............................................................ 18.4 27.1 92.3 120.0 143.7
N2O (thousand tons) ............................................................ 0.0 0.0 0.0 0.0 0.0
SO2 (thousand tons) ............................................................ 0.0 0.0 0.1 0.1 0.1
Hg (tons) .............................................................................. 0.0 0.0 0.0 0.0 0.0
Total FFC Emissions
CH4 (thousand tons) ............................................................ 18.6 27.3 93.1 121.1 144.9
N2O (thousand tons) ............................................................ 0.0 0.0 0.1 0.1 0.2
SO2 (thousand tons) ............................................................ 1.0 1.4 4.9 6.3 7.6
Hg (tons) .............................................................................. 0.0 0.0 0.0 0.0 0.0
As part of the analysis for this TSLs for distribution transformers. each of the SC–CO2 cases. The time-
rulemaking, DOE estimated monetary Section IV.L of this document discusses series of annual values is presented for
benefits likely to result from the the SC–CO2 values that DOE used. Table the proposed TSL in chapter 14 of the
reduced emissions of CO2 that DOE V.64 presents the value of CO2 NOPR TSD.
estimated for each of the considered emissions reduction at each TSL for
TABLE V.64—PRESENT VALUE OF CO2 EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS SHIPPED IN 2027–
2056
SC–CO2 Case

(million 2021$)
TSL
5% 3% 2.5% 3%
Average Average Average 95th percentile
Liquid-immersed Distribution Transformers
1 ....................................................................................................................... 603.2 2,773.2 4,425.4 8,386.0

2 ....................................................................................................................... 946.1 4,350.2 6,941.9 13,154.7
3 ....................................................................................................................... 1,394.3 6,410.7 10,229.9 19,385.3
4 ....................................................................................................................... 1,517.6 6,977.6 11,134.6 21,099.8
5 ....................................................................................................................... 1,597.1 7,343.2 11,718.0 22,205.4
Low-voltage Dry Type Distribution Transformers
1 ....................................................................................................................... 72.9 333.0 530.3 1,007.4

2 ....................................................................................................................... 106.1 484.8 772.1 1,466.7
3 ....................................................................................................................... 168.6 770.4 1,227.0 2,330.8
4 ....................................................................................................................... 450.3 2,056.9 3,276.0 6,223.1
5 ....................................................................................................................... 487.9 2,228.8 3,549.8 6,743.2
Medium-voltage Distribution Transformers

1 ....................................................................................................................... 15.9 72.7 115.8 220.0

2 ....................................................................................................................... 23.3 106.7 169.9 322.7
3 ....................................................................................................................... 79.8 364.4 580.4 1,102.5
4 ....................................................................................................................... 103.7 473.6 754.2 1,432.7
5 ....................................................................................................................... 124.0 566.7 902.5 1,714.4
As discussed in section IV.L.2, DOE distribution transformers. Table V.65 of annual values is presented for the
estimated the climate benefits likely to presents the value of the CH4 emissions proposed TSL in chapter 14 of the
result from the reduced emissions of reduction at each TSL, and Table V.66 NOPR TSD.
methane and N2O that DOE estimated presents the value of the N2O emissions
for each of the considered TSLs for reduction at each TSL. The time-series
TABLE V.65—PRESENT VALUE OF METHANE EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS SHIPPED IN
2027–2056
SC–CH4 Case

(million 2021$)
TSL
5% 3% 2.5% 3%
1 ....................................................................................................................... 202.8 659.9 939.6 1,748.1

2 ....................................................................................................................... 318.1 1,035.0 1,473.7 2,741.9
3 ....................................................................................................................... 469.0 1,526.2 2,173.0 4,042.9
4 ....................................................................................................................... 510.8 1,662.2 2,366.7 4,403.2
5 ....................................................................................................................... 538.6 1,752.5 2,495.3 4,642.6
1 ....................................................................................................................... 24.8 80.1 113.9 212.2

2 ....................................................................................................................... 36.2 116.7 165.8 309.0
3 ....................................................................................................................... 57.5 185.5 263.6 491.3
4 ....................................................................................................................... 153.4 494.9 703.4 1,310.8
5 ....................................................................................................................... 166.2 536.3 762.2 1,420.4
1 ....................................................................................................................... 5.4 17.6 25.0 46.6

2 ....................................................................................................................... 8.0 25.8 36.7 68.3
3 ....................................................................................................................... 27.3 88.0 125.1 233.2
4 ....................................................................................................................... 35.5 114.5 162.7 303.1
5 ....................................................................................................................... 42.4 137.0 194.7 362.8
TABLE V.66—PRESENT VALUE OF NITROUS OXIDE EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS SHIPPED IN
2027–2056
SC–N2O Case

(million 2021$)
TSL
5% 3% 2.5% 3%
1 ....................................................................................................................... 2.1 9.2 14.5 24.5

2 ....................................................................................................................... 3.4 14.4 22.7 38.5
3 ....................................................................................................................... 4.9 21.2 33.5 56.7
4 ....................................................................................................................... 5.4 23.1 36.5 61.7
5 ....................................................................................................................... 5.7 24.3 38.4 64.9
1 ....................................................................................................................... 0.3 1.1 1.7 2.9

2 ....................................................................................................................... 0.4 1.6 2.5 4.2
3 ....................................................................................................................... 0.6 2.5 4.0 6.8
4 ....................................................................................................................... 1.6 6.8 10.6 18.0
5 ....................................................................................................................... 1.7 7.3 11.5 19.5
1 ....................................................................................................................... 0.1 0.2 0.4 0.6

2 ....................................................................................................................... 0.1 0.4 0.6 0.9
3 ....................................................................................................................... 0.3 1.2 1.9 3.2
4 ....................................................................................................................... 0.4 1.6 2.4 4.2
TABLE V.66—PRESENT VALUE OF NITROUS OXIDE EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS SHIPPED IN
2027–2056—Continued
SC–N2O Case

(million 2021$)
TSL
5% 3% 2.5% 3%
5 ....................................................................................................................... 0.4 1.9 2.9 5.0
DOE is well aware that scientific and for estimating the monetary value of transformers. The dollar-per-ton values
economic knowledge about the reductions in CO2 and other GHG that DOE used are discussed in section
contribution of CO2 and other GHG emissions. This ongoing review will IV.L of this document. Table V.67
emissions to changes in the future consider the comments on this subject presents the present value for NOX
global climate and the potential that are part of the public record for this emissions reduction for each TSL
resulting damages to the global and U.S. and other rulemakings, as well as other calculated using 7-percent and 3-
economy continues to evolve rapidly. methodological assumptions and issues. percent discount rates, and Table V.68
Thus, any value placed on reduced GHG DOE notes that the proposed standards presents similar results for SO2
emissions in this proposed rulemaking would be economically justified even emissions reductions. The results in
is subject to change. That said, because without inclusion of monetized benefits these tables reflect application of EPA’s
of omitted damages, DOE agrees with of reduced GHG emissions. low dollar-per-ton values, which DOE
the IWG that these estimates most likely DOE also estimated the monetary
used to be conservative. The time-series
underestimate the climate benefits of value of the health benefits associated
greenhouse gas reductions. DOE, with NOX and SO2 emissions reductions of annual values is presented for the
together with other Federal agencies, anticipated to result from the proposed TSL in chapter 14 of the
will continue to review methodologies considered TSLs for distribution NOPR TSD.
TABLE V.67—PRESENT VALUE OF NOX EMISSIONS REDUCTION FOR DISTRIBUTION TRANSFORMERS SHIPPED IN 2027–
2056
3% Discount rate 7% Discount rate
TSL
Million 2021$ Million 2021$
Liquid-Immersed Distribution Transformers
1 ....................................................................................................................................................... 1,385.3 4,631.4

2 ....................................................................................................................................................... 2,172.9 7,264.6
3 ....................................................................................................................................................... 3,203.1 10,709.0
4 ....................................................................................................................................................... 3,487.6 11,660.1
5 ....................................................................................................................................................... 3,674.0 12,283.6
Low-voltage Dry-Type Distribution Transformers
1 ....................................................................................................................................................... 171.4 552.0

2 ....................................................................................................................................................... 249.5 803.7
3 ....................................................................................................................................................... 396.6 1,277.5
4 ....................................................................................................................................................... 1,058.5 3,409.6
5 ....................................................................................................................................................... 1,147.0 3,694.6
Medium-voltage Dry-Type Distribution Transformers
1 ....................................................................................................................................................... 37.5 120.8

2 ....................................................................................................................................................... 55.0 177.3
3 ....................................................................................................................................................... 187.9 605.4
4 ....................................................................................................................................................... 244.3 786.9
5 ....................................................................................................................................................... 292.4 941.7
TABLE V.68—PRESENT VALUE OF SO2 EMISSIONS REDUCTION DISTRIBUTION TRANSFORMERS SHIPPED IN 2027–2056

TSL
1 ....................................................................................................................................................... 477.8 1,556.7

2 ....................................................................................................................................................... 749.5 2,442.2
TABLE V.68—PRESENT VALUE OF SO2 EMISSIONS REDUCTION DISTRIBUTION TRANSFORMERS SHIPPED IN 2027–2056—
Continued
TSL
3 ....................................................................................................................................................... 1,104.1 3,597.5

4 ....................................................................................................................................................... 1,201.2 3,913.9
5 ....................................................................................................................................................... 1,262.4 4,113.2
Low-voltage Dry-Type Distribution Transformers
1 ....................................................................................................................................................... 57.8 181.3

2 ....................................................................................................................................................... 84.2 263.9
3 ....................................................................................................................................................... 133.8 419.3
4 ....................................................................................................................................................... 357.3 1,119.8
5 ....................................................................................................................................................... 387.1 1,213.4
Medium-voltage Dry-Type Distribution Transformers
1 ....................................................................................................................................................... 12.6 39.5

2 ....................................................................................................................................................... 18.5 57.9
3 ....................................................................................................................................................... 63.2 198.1
4 ....................................................................................................................................................... 82.1 257.4
5 ....................................................................................................................................................... 98.3 307.9
7. Other Factors 8. Summary of Economic Impacts transformers, and are measured for the
lifetime of products shipped in 2027–
The Secretary of Energy, in Table V.69 presents the NPV values 2056. The benefits associated with
determining whether a standard is that result from adding the estimates of reduced GHG emissions resulting from
economically justified, may consider the potential economic benefits the adopted standards are global
any other factors that the Secretary resulting from reduced GHG and NOX benefits, and are also calculated based
deems to be relevant. (42 U.S.C. and SO2 emissions to the NPV of on the lifetime of distribution
6295(o)(2)(B)(i)(VII)) No other factors consumer benefits calculated for each transformers shipped in 2027–2056.
were considered in this analysis. TSL considered in this rulemaking. The While many of the benefits from this
consumer benefits are domestic U.S. proposed standard extend through 2115,
monetary savings that occur as a result the monetized benefits from GHG
of purchasing the covered distribution reductions are capped at end of 2070.
TABLE V.69—CONSUMER NPV COMBINED WITH PRESENT VALUE OF CLIMATE AND HEALTH BENEFITS
Category TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
3% discount rate for Consumer NPV and Health Benefits (billion 2021$)
5% Average SC–GHG case ................................................ 10.0 15.1 21.7 22.9 12.3

2.5% Average SC–GHG case ............................................. 14.5 22.3 32.2 34.4 24.4
3% 95th percentile SC–GHG case ...................................... 19.3 29.8 43.3 46.4 37.1

Low-voltage Distribution Transformers



TABLE V.69—CONSUMER NPV COMBINED WITH PRESENT VALUE OF CLIMATE AND HEALTH BENEFITS—Continued


C. Conclusion in this section present a summary of the the owner is the operator, distribution
results of DOE’s quantitative analysis for transformers are often purchased based
When considering new or amended
each TSL. In addition to the quantitative on lowest first cost (see section IV.F.3)
energy conservation standards, the
results presented in the tables, DOE also rather than equipment efficiency.
standards that DOE adopts for any type
considers other burdens and benefits Having less than perfect foresight and a
(or class) of covered equipment must be
that affect economic justification. These high degree of uncertainty about the
designed to achieve the maximum
include the impacts on identifiable future, consumers may trade off these
improvement in energy efficiency that
subgroups of consumers who may be types of investments at a higher than
the Secretary determines is
disproportionately affected by a national expected rate between current
technologically feasible and standard and impacts on employment.
economically justified. (42 U.S.C. consumption and uncertain future
DOE also notes that the economics energy cost savings.
6295(o)(2)(A)) In determining whether a literature provides a wide-ranging
standard is economically justified, the discussion of how consumers trade off 1. Benefits and Burdens of TSLs
Secretary must determine whether the upfront costs and energy savings in the Considered for Liquid-Immersed
benefits of the standard exceed its absence of government intervention. Distribution Transformers Standards
burdens by, to the greatest extent Much of this literature attempts to
practicable, considering the seven explain why consumers appear to Table V.70 and Table V.71 summarize
statutory factors discussed previously. undervalue energy efficiency the quantitative impacts estimated for
(42 U.S.C. 6295(o)(2)(B)(i)) The new or improvements. There is evidence that each TSL for liquid-immersed
amended standard must also result in consumers undervalue future energy distribution transformers. The national
significant conservation of energy. (42 savings as a result of (1) entrenched impacts are measured over the lifetime
U.S.C. 6295(o)(3)(B)) purchasing practices, (2) a lack of of distribution transformers purchased
For this NOPR, DOE considered the sufficient salience of the long-term or in the 30-year period that begins in the
impacts of amended standards for each aggregate benefits, (3) a lack of sufficient anticipated year of compliance with
type of distribution transformer at each savings to warrant delaying or altering amended standards (2027–2056). The
TSL, beginning with the maximum purchases, (4) excessive focus on the energy savings, emissions reductions,
technologically feasible level, to short term, in the form of inconsistent and value of emissions reductions refer
determine whether that level was weighting of future energy cost savings to full-fuel-cycle results. The efficiency
economically justified. Where the max- relative to available returns on other levels contained in each TSL are
tech level was not justified, DOE then investments, (5) computational or other described in section V.A of this
considered the next most efficient level difficulties associated with the document. Table V.71 shows the
and undertook the same evaluation until evaluation of relevant tradeoffs, and (6) consumer impacts as equipment classes,
it reached the highest efficiency level a divergence in incentives. For example, which are the shipment weighted
that is both technologically feasible and in the case of dry-type distribution average results of each equipment
economically justified and saves a transformers the purchaser is often not class’s representative units. The
significant amount of energy. the operator of the equipment. Instead, consumer results for each representative
To aid the reader as DOE discusses they are often installed at the time of unit and information on the fraction of
the benefits and/or burdens for each building construction and operated by shipments they represent are shown in
type of equipment for each TSL, tables tenants. In other circumstances where section B.1.
TABLE V.70—SUMMARY OF ANALYTICAL RESULTS FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS TSLS: NATIONAL
IMPACTS
Cumulative FFC National Energy Savings
Quads ................................................................................... 3.22 5.06 7.43 8.02 8.45
Cumulative FFC Emissions Reduction
CH4 (thousand tons) ............................................................ 733.07 1149.83 1695.46 1846.56 1946.92
N2O (thousand tons) ............................................................ 0.92 1.45 2.14 2.32 2.44
SO2 (thousand tons) ............................................................ 39.65 62.21 91.65 99.71 104.82
Hg (tons) .............................................................................. 0.26 0.41 0.60 0.65 0.68
Present Value of Benefits and Costs (3% discount rate, billion 2021$)
Consumer Operating Cost Savings ..................................... 4.06 6.08 10.17 12.77 18.51
Climate Benefits * ................................................................. 3.44 5.40 7.96 8.66 9.12
Health Benefits ** ................................................................. 6.19 9.71 14.31 15.57 16.40
Total Benefits † .................................................................... 13.70 21.19 32.43 37.01 44.03
Consumer Incremental Product Costs ‡ .............................. 1.09 1.93 4.67 7.48 24.76
Consumer Net Benefits ........................................................ 2.98 4.15 5.50 5.30 ¥6.25
Total Net Benefits ................................................................ 12.61 19.26 27.76 29.53 19.27
Health Benefits ** ................................................................. 1.86 2.92 4.31 4.69 4.94
Total Benefits † .................................................................... 6.67 10.36 15.67 17.63 20.26
Consumer Net Benefits ........................................................ 0.78 1.00 0.89 0.26 ¥7.11
consumers which accrue after 2056 from the equipment shipped in 2027–2056.
value. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but
† Total and net benefits include consumer, climate, and health benefits. Total benefits for both the 3-percent and 7-percent cases are pre-
sented using the average SC–GHG with 3-percent discount rate, but the Department does not have a single central SC–GHG point estimate.
DOE emphasizes the importance and value of considering the benefits calculated using all four SC–GHG estimates. See Table V.69 for net ben-
efits using all four SC–GHG estimates.
TABLE V.71—SUMMARY OF ANALYTICAL RESULTS FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS TSLS:

MANUFACTURER AND CONSUMER IMPACTS
Category TSL 1 * TSL 2 * TSL 3 * TSL 4 * TSL 5 *
Manufacturer Impacts
Industry NPV (million 2021$) (No-new-standards case

INPV = $1,384 million) ..................................................... 1,283 to 1,297 1,242 to 1,268 1,166 to 1,232 1,133 to 1,233 1,004 to 1,347
Industry NPV (% change) .................................................... (7.3) to (6.3) (10.3) to (8.4) (15.8) to (11.0) (18.1) to (27.5) to (2.7)
(10.9)
Consumer Average LCC Savings (2021$)
Equipment Class 1 * ............................................................. 105 135 147 120 (269)

Equipment Class 2 * ............................................................. 321 658 887 868 (2,493)
Equipment Class 12 * ........................................................... n.a. n.a. n.a. n.a. (7,482)
TABLE V.71—SUMMARY OF ANALYTICAL RESULTS FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS TSLS:

MANUFACTURER AND CONSUMER IMPACTS—Continued
Shipment-Weighted Average ** ............................................ 120 172 199 172 (425)
Consumer Simple PBP (years)
Equipment Class 1 ............................................................... 19.0 16.3 7.4 11.4 31.7

Equipment Class 2 ............................................................... 20.8 18.7 12.1 12.5 24.6
Equipment Class 12 ............................................................. n.a. n.a. n.a. n.a. 36.0
Shipment-Weighted Average ** ............................................ 19 16 8 12 31
Percent of Consumers that Experience a Net Cost
Equipment Class 1 ............................................................... 32 27 17 18 87

Equipment Class 2 ............................................................... 39 54 26 19 64
Equipment Class 12 ............................................................. n.a. n.a. n.a. n.a. 95
Parentheses indicate negative (¥) values. The entry ‘‘n.a.’’ means not applicable because there is no change in the standard at certain TSLs.
* The equipment classes, shown here are the shipment weighted average results of each equipment class’s representative units. The con-
sumer results for each representative unit and information on the fraction of shipments they represent are shown in section B.1.
** Scaled across the representative capacities of each equipment class and weighted by shares of each equipment class in total projected
shipments in 2022.
First, DOE considered TSL 5, which At TSL 5, the projected change in equipment life, while operating cost
represents the max-tech efficiency INPV ranges from a decrease of $380.7 savings occur throughout the equipment
levels. TSL 5 would save an estimated million to a decrease of $37.2 million, lifetime, with later years heavily
8.45 quads of energy, an amount DOE which corresponds to a change in INPV discounted. Further, there is risk of
considers significant. Under TSL 5, the of –27.5 percent and –2.7 percent, greater reduction in INPV at max-tech if
NPV of consumer benefit would be respectively. DOE estimates that manufacturers maintain their operating
$¥7.11 billion using a discount rate of industry must invest $289.4 million to profit in the presence of amended
7 percent, and $¥6.25 billion using a comply with standards set at TSL 5. efficiency standards on account of
discount rate of 3 percent. The Secretary tentatively concludes having higher costs but similar profits.
The cumulative emissions reductions that at TSL 5 for liquid-immersed The benefits of max-tech efficiency
at TSL 5 are 269.69 Mt of CO2, 104.82 distribution transformers, the benefits of levels for liquid-immersed distribution
thousand tons of SO2, 425.24 thousand energy savings, emission reductions, transformer do not outweigh the
tons of NOX, 0.68 tons of Hg, 1946.92 and the estimated monetary value of the negative impacts to consumers and
thousand tons of CH4, and 2.44 emissions reductions would be manufacturers. Consequently, the
thousand tons of N2O. The estimated outweighed by the economic burden on Secretary has tentatively concluded that
monetary value of the climate benefits many consumers as indicated by TSL 5 is not economically justified.
from reduced GHG emissions lengthy PBPs, the percentage of Next, DOE considered TSL 4, which
(associated with the average SC–GHG at customers who would experience LCC would save an estimated 8.02 quads of
a 3-percent discount rate) at TSL 5 is increases, negative consumer NPV at energy, an amount DOE considers
$9.12 billion. The estimated monetary both 3 and 7 percent discount rates, and significant. Under TSL 4, the NPV of
value of the health benefits from the capital and engineering costs that consumer benefit would be $0.26 billion
reduced SO2 and NOX emissions at TSL would result in a reduction in INPV for using a discount rate of 7 percent, and
5 is $4.94 billion using a 7-percent manufacturers. At TSL 5, the LCC $5.30 billion using a discount rate of 3
discount rate and $16.40 billion using a savings are negative for most liquid- percent.
3-percent discount rate. immersed distribution transformers, The cumulative emissions reductions
Using a 7-percent discount rate for indicating there is a substantial risk that at TSL 4 are 256.27 Mt of CO2, 99.71
consumer benefits and costs, health a disproportionate number of consumers thousand tons of SO2, 403.57 thousand
benefits from reduced SO2 and NOX will incur increased costs; these costs tons of NOX, 0.65 tons of Hg, 1,846.56
emissions, and the 3-percent discount are also reflected in simple payback thousand tons of CH4, and 2.32
rate case for climate benefits from period estimates that approach or thousand tons of N2O. The estimated
reduced GHG emissions, the estimated exceed average lifetimes. NPVs are monetary value of the climate benefits
total NPV at TSL 5 is $6.95 billion. calculated for equipment shipped over from reduced GHG emissions
Using a 3-percent discount rate for all the period of 2027 through 2056 (see (associated with the average SC–GHG at
benefits and costs, the estimated total section IV.H.3). Distribution a 3-percent discount rate) at TSL 4 is
NPV at TSL 5 is $19.27 billion. transformers are durable equipment $8.66 billion. The estimated monetary
At TSL 5, the average LCC impact with a maximum lifetime estimated at value of the health benefits from
ranges from $–269 for equipment class 60 years (see section IV.F.8), accruing
reduced SO2 and NOX emissions at TSL

1 to $–7,482 for equipment class 12. The operating cost savings through 2115. 4 is $4.69 billion using a 7-percent
median PBP ranges from 24.6 years for When considered over this time period, discount rate and $15.57 billion using a
equipment class 2 to 36.0 for equipment the discounted value of the incremental 3-percent discount rate.
class 12. The fraction of consumers equipment costs outweigh the Using a 7-percent discount rate for
experiencing a net LCC cost ranges from discounted value of the operating costs consumer benefits and costs, health
64 percent for equipment class 2 to 95 savings. Incremental equipment costs benefits from reduced SO2 and NOX
percent for equipment class 12. are incurred in the first year of emissions, and the 3-percent discount
rate case for climate benefits from distribution transformer applications majority of energy savings are associated
reduced GHG emissions, the estimated (estimated to be approximately 225,000 with reducing no-load losses. While
total NPV at TSL 4 is $13.61 billion. metric tons). Further, amorphous higher grades of GOES may have
Using a 3-percent discount rate for all capacity grew in response to the April slightly improved no-load loss
benefits and costs, the estimated total 2013 Standards Final Rule, although characteristics, amorphous steel tends to
NPV at TSL 4 is $29.53 billion. market demand did not necessarily reduce no-load losses by over 60
At TSL 4, the average LCC impact grow in-kind. Further, amorphous steel percent. Meaning, even if the best
ranges from $120 for equipment class 1 manufacturers’ response to the April performing grades of GOES were
to $868 for equipment class 2. The mean 2013 Standards Final Rule demonstrates available in unlimited quantities,
PBP ranges from 11.4 years for that amorphous capacity can be added amorphous steel would still lead to
equipment class 1 to 12.5 years for quickly and would be added in response significant energy savings. Further, by
equipment class 2, well below the to an amended standard. Stakeholders nature of DOE evaluating efficiency of
average lifetime of 32 years. The fraction have expressed willingness to increase liquid-immersed distribution
of consumers experiencing a net LCC supply to match any potential demand transformers at 50 percent load, even if
cost ranges is 18 percent for equipment created by an amended efficiency loading increases such that in-service
classes 1 and 2. standard. In the current market, RMS average PUL is 50 percent, the
At TSL 4, the projected change in increased capacity of amorphous steel is distribution transformers produced
INPV ranges from a decrease of $251.3 limited more by the demand for under the amended efficiency standard
million to a decrease of $151.0 million, amorphous steel rather than any would be more efficient than minimally
which corresponds to decreases of 18.1 constraints on potential production efficient transformers on the market
percent and 10.9 percent, respectively. capacity. Therefore, in the presence of today.
DOE estimates that industry must invest an amended standard, it is expected that The transition from GOES cores to
$270.6 million to comply with amorphous capacity would quickly rise amorphous cores does require some
standards set at TSL 4. to meet demand before the effective date amount of investment on the part of the
After considering the analysis and of any amended energy conservation
weighing the benefits and burdens, the distribution transformer manufacturer if
standards. they produce their own cores. While
Secretary has tentatively concluded that While there has historically been
a standard set at TSL 4 for liquid- these costs are not trivial, the benefit to
concern over the fact that there is only consumers vastly outweighs the cost to
immersed distribution transformers a single domestic supplier of amorphous
would be economically justified. manufacturers. Further, the increased
steel, the GOES market is also served by
Notably, the benefits to consumers practice of outsourcing distribution
a single domestic supplier. Stakeholders
outweigh the cost to manufacturers. At transformer core production means that
have noted that sufficient domestic
this TSL, the average LCC savings are there is little burden on small
supply of GOES is available only for M3
positive across all equipment classes. businesses, who overwhelmingly
steel. Any efficiency standard that
An estimated 18 percent of liquid- purchase prefabricated distribution
requires steel with lower no-load losses
immersed distribution transformer transformer cores, rather than producing
than M3 would not be able to be served
consumers experience a net cost. The them in-house. As stated, DOE conducts
entirely by a domestic source without
FFC national energy savings are the ‘‘walk-down’’ analysis to determine
further investment. The current market
significant and the NPV of consumer the TSL that represents the maximum
of electrical steel in distribution
benefits is positive using both a 3- transformer applications is very much a improvement in energy efficiency that is
percent and 7-percent discount rate. At global market at present. technologically feasible and
TSL 4, the NPV of consumer benefits, Further, while some stakeholders economically justified as required under
even measured at the more conservative have expressed concern as to whether EPCA. The walk-down is not a
discount rate of 7 percent is larger than amorphous supply would be sufficient comparative analysis, as a comparative
the maximum estimated manufacturers’ to serve the entire market, stakeholders analysis would result in the
loss in INPV. The standard levels at TSL have also expressed supply concerns maximization of net benefits instead of
4 are economically justified even regarding GOES. Notably, stakeholders energy savings that are technologically
without weighing the estimated have identified increased competition feasible and economically justified,
monetary value of emissions reductions. for non-oriented electrical steel to serve which would be contrary to the statute.
When those emissions reductions are the electric vehicle market. This 86 FR 70892, 70908.
included—representing $8.66 billion in competing demand is not expected to Although DOE considered proposed
climate benefits (associated with the disappear in the near term and amended standard levels for
average SC–GHG at a 3-percent discount stakeholders have already seen supply distribution transformers by grouping
rate), and $15.57 billion (using a 3- challenges for many of the higher the efficiency levels for each equipment
percent discount rate) or $4.69 billion performing GOES grades. Amorphous class into TSLs, DOE evaluates all
(using a 7-percent discount rate) in steel has not been commercialized in analyzed efficiency levels in its
health benefits—the rationale becomes electric motor applications and as such, analysis. The TSLs constructed by DOE
stronger still. does not experience the same competing to examine the impacts of amended
The energy savings under TSL 4 are demand for electric vehicle energy efficiency standards for liquid-
primarily achievable by using applications. The increased demand for immersed distribution transformers
amorphous steel. Both global and non-oriented electrical steel also offers align with the corresponding ELs
domestic capacity of amorphous steel is defined in the engineering analysis. For
an alternative for current producers of

greater than it was during the GOES steel to transition their the ELs above baseline that compose
consideration of the April 2013 production to non-oriented electrical TSL 4 DOE finds that LCC savings are
Standards Final Rule and global steel, meeting a needed market demand. positive for all equipment classes, with
capacity of amorphous steel (estimated The consistent practice of distribution simple paybacks well below the average
to be approximately 150,000–250,000 transformer customers to lightly-load equipment lifetimes. DOE also finds that
metric tons) is approximately equal to their distribution transformers (see the estimated fraction of consumers who
the U.S. demand for electrical steel in section IV.E.1.a), means that the would be negatively impacted from a
standard at TSL 4 to be 18 percent for current standard, with the exception of liquid-immersed distribution
all equipment classes. submersible liquid-immersed transformers at TSL 4. The proposed
For liquid-immersed distribution distribution transformers (equipment amended energy conservation standards
transformers (including single-phase class 12) which remain at baseline. for distribution transformers, which are
and three-phase equipment) TSL 4 (i.e., Therefore, based on the previous expressed as percentage efficiency at 50
the proposed TSL) represents a 20 considerations, DOE proposes to adopt percent PUL are shown in Table V.72.
percent reduction in losses over the the energy conservation standards for
TABLE V.72—PROPOSED AMENDED ENERGY CONSERVATION STANDARDS FOR LIQUID-IMMERSED DISTRIBUTION

TRANSFORMERS
Electrical efficiency by kVA and Equipment class
Equipment class 1 Equipment class 2 Equipment class 12
Single-phase Three-phase Single-phase submersible Three-phase submersible
kVA kVA kVA kVA
10 ................................. 98.96 15 98.92 10 98.70 15 98.65

15 ................................. 99.05 30 99.06 15 98.82 30 98.83
25 ................................. 99.16 45 99.13 25 98.95 45 98.92
37.5 .............................. 99.24 75 99.22 37.5 99.05 75 99.03
50 ................................. 99.29 112.5 99.29 50 99.11 112.5 99.11
75 ................................. 99.35 150 99.33 75 99.19 150 99.16
100 ............................... 99.40 225 99.38 100 99.25 225 99.23
167 ............................... 99.46 300 99.42 167 99.33 300 99.27
250 ............................... 99.51 500 99.48 250 99.39 500 99.35
333 ............................... 99.54 750 99.52 333 99.43 750 99.40
500 ............................... 99.59 1,000 99.54 500 99.49 1,000 99.43
667 ............................... 99.62 1,500 99.58 667 99.52 1,500 99.48
833 ............................... 99.64 2,000 99.61 833 99.55 2,000 99.51
2,500 99.62 ........................ ........................ 2,500 99.53
3,750 99.66 ........................ ........................ ........................ ........................
5,000 99.68 ........................ ........................ ........................ ........................
2. Benefits and Burdens of TSLs of distribution transformers purchased document. Table V.74 shows the
Considered for Low-Voltage Dry-Type in the 30-year period that begins in the consumer impacts as Equipment classes,
Distribution Transformers Standards anticipated year of compliance with which are the shipment weighted
amended standards (2027–2056). The average results of each Equipment
Table V.73 and Table V.74 summarize energy savings, emissions reductions, class’s representative units. The
the quantitative impacts estimated for and value of emissions reductions refer consumer results for each representative
each TSL for low-voltage dry-type to full-fuel-cycle results. The efficiency unit and information on the fraction of
distribution transformers. The national levels contained in each TSL are shipments they represent are shown in
impacts are measured over the lifetime described in section V.A of this section B.1.
TABLE V.73—SUMMARY OF ANALYTICAL RESULTS FOR LOW-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS TSLS:
NATIONAL IMPACTS
Quads ................................................................................... 0.37 0.54 0.85 2.28 2.47
CH4 (thousand tons) ............................................................ 84.76 123.42 196.22 523.53 567.30
N2O (thousand tons) ............................................................ 0.10 0.15 0.24 0.64 0.70
SO2 (thousand tons) ............................................................ 4.45 6.48 10.30 27.51 29.81
Hg (tons) .............................................................................. 0.03 0.04 0.07 0.18 0.19
Health Benefits ** ................................................................. 0.73 1.07 1.70 4.53 4.91
Total Benefits † .................................................................... 2.57 3.74 5.92 19.97 21.13
Consumer Incremental Product Costs ‡ .............................. ¥0.06 ¥0.03 1.39 3.16 3.82
Consumer Net Benefits ........................................................ I 1.48 2.11 I 1.87 9.72 I 9.63
NATIONAL IMPACTS—Continued
Health Benefits ** ................................................................. 0.23 0.33 0.53 1.42 1.53
Total Benefits † .................................................................... 1.14 1.66 2.63 8.46 8.99
Consumer Incremental Product Costs ‡ .............................. ¥0.03 ¥0.02 0.75 1.70 2.05
Consumer Net Benefits ........................................................ 0.53 0.74 0.39 2.79 2.63

sented using the average SC–GHG with 3-percent discount rate, but the Department does not have a single central SC–GHG point estimate.
MANUFACTURER AND CONSUMER IMPACTS

INPV = $194 million ......................................................... 189 188 to 189 167 to 177 145 to 168 133 to 161
Industry NPV (% change) .................................................... (2.8) (3.0) to (2.5) (13.9) to (8.7) (25.3) to (13.6) (31.4) to
(17.2)
Equipment Class 3 * ............................................................. 312 203 146 108 147

Equipment Class 4 * ............................................................. 357 381 214 624 574
Equipment Class 3 * ............................................................. 0.0 3.3 7.6 11.7 11.7

Equipment Class 4 * ............................................................. 0.3 0.7 8.6 7.8 9.1
Shipment-Weighted Average ** ............................................ 0.3 1.0 7.6 7.4 8.4

Equipment Class 3 * ............................................................. 1 17 33 43 40

Equipment Class 4 * ............................................................. 8 9 30 10 16
Parentheses indicate negative (¥) values. The entry ‘‘n.a.’’ means not applicable because there is no change in the standard at certain TSLs.
shipments in 2022
First, DOE considered TSL 5, which percent of equipment class 3 low- steel would result in amorphous
represents the max-tech efficiency voltage dry-type distribution capacity quickly rising to meet demand
levels. TSL 5 would save an estimated transformer consumers experience a net before the effective date of any amended
2.47 quads of energy, an amount DOE cost. The FFC national energy savings energy conservation standards. The
considers significant. Under TSL 5, the are significant and the NPV of consumer increased amorphous capacity would
NPV of consumer benefit would be benefits is positive using both a 3- then be able to serve both the liquid-
$2.63 billion using a discount rate of 7 percent and 7-percent discount rate. immersed and the low-voltage dry-type
percent, and $9.63 billion using a Notably, the benefits to consumers market.
discount rate of 3 percent. vastly outweigh the cost to As discussed in section V.C.1, the
The cumulative emissions reductions manufacturers. At TSL 5, the NPV of
consistent practice of distribution
at TSL 5 are 77.57 Mt of CO2, 29.81 consumer benefits, even measured at the
transformer customers to lightly-load
thousand tons of SO2, 123.44 thousand more conservative discount rate of 7
tons of NOX, 0.19 tons of Hg, 567.30 their distribution transformers, means
percent is over 43.15 times higher than
thousand tons of CH4, and 0.70 that the majority of energy savings are
the maximum estimated manufacturers’
thousand tons of N2O. The estimated associated with reducing no-load losses.
loss in INPV. The standard levels at TSL
monetary value of the climate benefits While higher grades of GOES may have
5 are economically justified even
from reduced GHG emissions slightly improved no-load loss
without weighing the estimated
(associated with the average SC–GHG at characteristics, amorphous steel tends to
monetary value of emissions reductions.
a 3-percent discount rate) at TSL 5 is reduce no-load losses by over 60
When those emissions reductions are
$2.77 billion. The estimated monetary included—representing $2.77 billion in percent. By nature of DOE evaluating
value of the health benefits from climate benefits (associated with the efficiency of low-voltage dry-type
reduced SO2 and NOX emissions at TSL average SC–GHG at a 3-percent discount distribution transformers at 35 percent
5 is $1.53 billion using a 7-percent rate), and $4.91 billion (using a 3- load, even if loading increases such that
discount rate and $4.91 billion using a percent discount rate) or $1.53 billion in-service RMS average PUL is 35
3-percent discount rate. (using a 7-percent discount rate) in percent, the distribution transformers
Using a 7-percent discount rate for health benefits—the rationale becomes produced under the amended efficiency
consumer benefits and costs, health stronger still. standard would be more efficient than
benefits from reduced SO2 and NOX The energy savings under TSL 5 are minimally efficient transformers on the
emissions, and the 3-percent discount primarily achievable by using market today.
rate case for climate benefits from amorphous steel. Both global and As stated, DOE conducts the walk-
reduced GHG emissions, the estimated domestic capacity of amorphous steel is down analysis to determine the TSL that
total NPV at TSL 5 is $6.94 billion. greater than it was during the represents the maximum improvement
Using a 3-percent discount rate for all consideration of the April 2013 in energy efficiency that is
benefits and costs, the estimated total Standards Final Rule and global technologically feasible and
NPV at TSL 5 is $17.31 billion. capacity of amorphous (estimated to be economically justified as required under
At TSL 5, the average LCC impact approximately 150,000–250,000 metric EPCA.
ranges from $147 for equipment class 3 tons) is approximately equal to the U.S. Although DOE considered proposed
to $574 for equipment class 4. The demand for electrical steel in amended standard levels for
median PBP ranges from 9.1 years for distribution transformer applications
distribution transformers by grouping
equipment class 4 to 11.7 years for (estimated to be approximately 225,000
the efficiency levels (ELs) for each
equipment class 3. The fraction of metric tons). Further, amorphous
equipment class into TSLs, DOE
consumers experiencing a net LCC cost capacity grew in response to the April
evaluates all analyzed efficiency levels
ranges from 16 percent for equipment 2013 Standards Final Rule, although
in its analysis. For low-voltage dry-type
class 4 to 40 percent for equipment class market demand did not necessarily
distribution transformers, TSL 5 (i.e.,
3. grow in-kind. As such, there is currently
At TSL 5, the projected change in the proposed TSL) maps directly to EL
excess amorphous steel capacity.
INPV ranges from a decrease of $61.0 5 for each equipment class and
Amorphous manufacturers response to
million to a decrease of $33.5 million, represents a 50 percent reduction in
the April 2013 Standards Final Rule
which corresponds to decreases of 31.4 demonstrates that amorphous capacity losses over the current standard for
percent and 17.2 percent, respectively. can be added quickly and is limited single-phase distribution transformers,
DOE estimates that industry must invest more by the market demand for and a 40 percent reduction in losses
$69.4 million to comply with standards amorphous steel rather that the ability over the current standard for three-
set at TSL 5. to build out new supply. Stakeholders phase distribution transformers.
After considering the analysis and have expressed willingness to increase Therefore, based on the previous
weighing the benefits and burdens, the supply to match any potential demand considerations, DOE proposes to adopt
Secretary has tentatively concluded that created by an amended efficiency the energy conservation standards for
at a standard set at TSL 5 for low- standard. The majority of electrical steel low-voltage dry-type distribution
voltage dry-type distribution use in distribution transformer transformers at TSL 5. The proposed
transformers would be economically applications is associated with liquid- amended energy conservation standards
justified. At this TSL, the average LCC immersed distribution transformer. for low-voltage dry-type distribution
savings are positive across all Therefore, a proposed standard for transformers, which are expressed as
equipment classes. An estimated 16 liquid-immersed distribution percentage efficiency at 35 percent PUL

percent of equipment class 4 to 40 transformers that requires amorphous are shown in Table V.75.
TABLE V.75—PROPOSED AMENDED ENERGY CONSERVATION STANDARDS FOR LOW-VOLTAGE DRY-TYPE DISTRIBUTION
TRANSFORMERS
Equipment class 3 Equipment class 4
kVA kVA
15 .................................................................................. 98.84 15 ................................................................................. 98.72

25 .................................................................................. 98.99 30 ................................................................................. 98.93
37.5 ............................................................................... 99.09 45 ................................................................................. 99.03
50 .................................................................................. 99.14 75 ................................................................................. 99.16
75 .................................................................................. 99.24 112.5 ............................................................................ 99.24
100 ................................................................................ 99.30 150 ............................................................................... 99.29
167 ................................................................................ 99.35 225 ............................................................................... 99.36
250 ................................................................................ 99.40 300 ............................................................................... 99.41
333 ................................................................................ 99.45 500 ............................................................................... 99.48
750 ............................................................................... 99.54
1,000 ............................................................................ 99.57
3. Benefits and Burdens of TSLs of distribution transformers purchased document. Table V.77 shows the
Considered for Medium-Voltage Dry- in the 30-year period that begins in the consumer impacts as equipment classes,
Type Distribution Transformers anticipated year of compliance with which are the shipment weighted
Standards amended standards (2027–2056). The average results of each equipment
Table V.76 and Table V.77 summarize energy savings, emissions reductions, class’s representative units. The
the quantitative impacts estimated for and value of emissions reductions refer consumer results for each representative
each TSL for medium-voltage dry-type to full-fuel-cycle results. The efficiency unit and information on the fraction of
distribution transformers. The national levels contained in each TSL are shipments they represent are shown in
impacts are measured over the lifetime described in section V.A of this section B.1.
TABLE V.76—SUMMARY OF ANALYTICAL RESULTS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS
TSLS: NATIONAL IMPACTS
Quads ................................................................................... 0.08 0.12 0.40 0.53 0.63
CH4 (thousand tons) ............................................................ 18.59 27.29 93.13 121.07 144.90
N2O (thousand tons) ............................................................ 0.02 0.03 0.11 0.15 0.18
SO2 (thousand tons) ............................................................ 0.97 1.43 4.87 6.33 7.58
Hg (tons) .............................................................................. 0.01 0.01 0.03 0.04 0.05
Health Benefits ** ................................................................. 0.16 0.24 0.80 1.04 1.25
Total Benefits † .................................................................... 0.53 0.77 3.38 4.13 4.67
Health Benefits ** ................................................................. 0.05 0.07 0.25 0.33 0.39

Total Benefits † .................................................................... 0.24 0.35 1.44 1.79 2.04
junction issued in Louisiana v. Biden, No. 21-cv-1074–JDC–KK (W.D. La.). As a result of the Fifth Circuit’s order, the preliminary injunction is no
sented using the average SC–GHG with 3-percent discount rate, but the Department does not have a single central SC–GHG point estimate. .
TABLE V.77—SUMMARY OF ANALYTICAL RESULTS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION TRANSFORMERS

TSLS: MANUFACTURER AND CONSUMER IMPACTS

INPV = $87 million ........................................................... 85 85 to 86 71 to 80 69 to 80 65 to 82
Industry NPV ( % change) ................................................... (2.1) (3.0) to (0.9) (18.7) to (8.8) (21.4) to (7.8) (25.9) to (5.9)
Equipment Class 6 * ............................................................. 1,227 833 (165) (985) (1,557)

Equipment Class 8 * ............................................................. 4,556 3,016 647 224 (3,727)
Equipment Class 10 * ........................................................... (1,209) (2,528) (5,704) (5,569) (9,558)
Shipment-Weighted Average ** ............................................ 1,594 641 (1,139) (1,348) (3,898)
Equipment Class 6 * ............................................................. 1.9 4.5 12.1 17.0 15.6

Equipment Class 8 * ............................................................. 0.4 1.9 13.5 14.1 18.0
Equipment Class 10 * ........................................................... 24.9 24.9 22.3 19.8 21.8
Shipment-Weighted Average ** ............................................ 7.9 8.9 14.1 13.7 16.3
Equipment Class 6 * ............................................................. 7 16 48 68 59

Equipment Class 8 * ............................................................. 3 11 48 51 77
Equipment Class 10 * ........................................................... 83 83 77 82 92
The entry ‘‘n.a.’’ means not applicable because there is no change in the standard at certain TSLs.
shipments in 2022.
First, DOE considered TSL 5, which from reduced GHG emissions Using a 3-percent discount rate for all
represents the max-tech efficiency (associated with the average SC–GHG at benefits and costs, the estimated total
levels. TSL 5 would save an estimated a 3-percent discount rate) at TSL 5 is NPV at TSL 5 is $2.92 billion.
0.63 quads of energy, an amount DOE $0.71 billion. The estimated monetary At TSL 5, the average LCC impact
considers significant. Under TSL 5, the value of the health benefits from ranges from $¥9,558 for equipment
NPV of consumer benefit would be $3 reduced SO2 and NOX emissions at TSL class 10 to $¥1557 for equipment class
million using a discount rate of 7 5 is $0.39 billion using a 7-percent 6. The mean PBP ranges from 15.6 years
percent, and $0.96 billion using a discount rate and $1.25 billion using a for equipment class 6 to 21.8 years for
discount rate of 3 percent. 3-percent discount rate. equipment class 10. The fraction of
The cumulative emissions reductions Using a 7-percent discount rate for consumers experiencing a net LCC cost
at TSL 5 are 19.72 Mt of CO2, 7.58 consumer benefits and costs, health ranges from 92 percent for equipment
thousand tons of SO2, 31.49 thousand benefits from reduced SO2 and NOX class 10 to 59 percent for equipment
tons of NOX, 0.05 tons of Hg, 144.90 emissions, and the 3-percent discount class 6.
thousand tons of CH4, and 0.18 rate case for climate benefits from At TSL 5, the projected change in
thousand tons of N2O. The estimated reduced GHG emissions, the estimated INPV ranges from a decrease of $22.6
monetary value of the climate benefits total NPV at TSL 5 is $1.10 billion. million to a decrease of $5.2 million,
which corresponds to decreases of 25.9 consumers experiencing a net LCC cost benefits and costs, the estimated total
percent and 5.9 percent, respectively. ranges from 51 percent for equipment NPV at TSL 3 is $2.50 billion.
DOE estimates that industry must invest class 8 to 82 percent for equipment class At TSL 3, the average LCC impact
$21.2 million to comply with standards 10. ranges from $¥5,704 for equipment
set at TSL 5. At TSL 4, the projected change in class 10 to $647 for equipment class 8.
The Secretary tentatively concludes INPV ranges from a decrease of $18.7 The mean PBP ranges from 12.1years for
that at TSL 5 for medium-voltage dry- million to a decrease of $6.8 million, equipment class 6 to 22.3 years for
type distribution transformers, the which corresponds to decreases of 21.4 equipment class 10. The fraction of
benefits of energy savings, emission percent and 7.8 percent, respectively. consumers experiencing a net LCC cost
reductions, and the estimated monetary DOE estimates that industry must invest ranges from 77 percent for 10 to 48
value of the emissions reductions would $19.2 million to comply with standards percent for both equipment class 6 and
be outweighed by the economic burden set at TSL 4. 8.
on many consumers as indicated by the The Secretary tentatively concludes At TSL 3, the projected change in
negative LCCs for many equipment that at TSL 4 for medium-voltage dry- INPV ranges from a decrease of $16.3
classes, the percentage of customers type distribution transformers, the million to a decrease of $7.7 million,
who would experience LCC increases, benefits of energy savings, emission which corresponds to decreases of 18.7
and the capital and engineering costs reductions, and the estimated monetary percent and 8.8 percent, respectively.
that could result in a reduction in INPV value of the emissions reductions would DOE estimates that industry must invest
for manufacturers. At TSL 5 DOE is be outweighed by the economic burden $17.9 million to comply with standards
estimating negative benefits for a on many consumers as indicated by the set at TSL 3.
disproportionate fraction of negative LCCs for many equipment The Secretary tentatively concludes
consumers—a shipment weighted classes, the percentage of customers that at TSL 3 for medium-voltage dry-
average of 58 percent. Further DOE who would experience LCC increases, type distribution transformers, the
estimates that there is a substantial risk and the capital and engineering costs benefits of energy savings, emission
to consumers, with a shipment weighted that could result iyn a reduction in reductions, and the estimated monetary
LCC savings for all MVDT equipment of INPV for manufacturers. At TSL 4 DOE value of the emissions reductions would
¥$3,898. Consequently, the Secretary is estimating negative benefits for a be outweighed by the economic burden
has tentatively concluded that TSL 5 is disproportionate fraction of consumers on many consumers as indicated by the
not economically justified. shipment weighted average of 53 negative LCCs for many equipment
Next, DOE considered TSL 4, which
percent. Further DOE estimates that classes, the percentage of customers
would save an estimated 0.53 quads of
there a substantial risk to consumers who would experience LCC increases,
energy, an amount DOE considers
with a shipment weighted LCC savings and the capital and engineering costs
significant. Under TSL 4, the NPV of
for all MVDT equipment of ¥$1,348. that could result in a reduction in INPV
consumer benefit would be $0.23 billion
using a discount rate of 7 percent, and Consequently, the Secretary has for manufacturers. At TSL 3 DOE is
$1.30 billion using a discount rate of 3 tentatively concluded that TSL 4 is not estimating negative benefits for a
percent. economically justified. disproportionate fraction of consumers
The cumulative emissions reductions Next, DOE considered TSL 3, which shipment weighted average of 50
at TSL 4 are 16.48 Mt of CO2, 6.33 would save an estimated 0.40 quads of percent. Further DOE estimates that
thousand tons of SO2, 26.31 thousand energy, an amount DOE considers there a substantial risk to consumers
tons of NOX, 0.04 tons of Hg, 121.07 significant. Under TSL 3, the NPV of with a shipment weighted LCC savings
thousand tons of CH4, and 0.15 consumer benefit would be $0.27 billion for all MVDT equipment of ¥$1,139.
thousand tons of N2O. The estimated using a discount rate of 7 percent, and Consequently, the Secretary has
monetary value of the climate benefits $1.25 billion using a discount rate of 3 tentatively concluded that TSL 3 is not
from reduced GHG emissions percent. economically justified.
(associated with the average SC–GHG at The cumulative emissions reductions Next, DOE considered TSL 2, which
a 3-percent discount rate) at TSL 4 is at TSL 3 are 12.68 Mt of CO2, 4.87 would save an estimated 0.12 quads of
$0.59 billion. The estimated monetary thousand tons of SO2, 20.24 thousand energy, an amount DOE considers
value of the health benefits from tons of NOX, 0.03 tons of Hg, 93.13 significant. Under TSL 2, the NPV of
reduced SO2 and NOX emissions at TSL thousand tons of CH4, and 0.11 consumer benefit would be $0.04 billion
4 is $0.33 billion using a 7-percent thousand tons of N2O. The estimated using a discount rate of 7 percent, and
discount rate and $1.04 billion using a monetary value of the climate benefits $0.21 billion using a discount rate of 3
3-percent discount rate. from reduced GHG emissions percent.
Using a 7-percent discount rate for (associated with the average SC–GHG at The cumulative emissions reductions
consumer benefits and costs, health a 3-percent discount rate) at TSL 4 is at TSL 2 are 3.71 Mt of CO2, 1.43
benefits from reduced SO2 and NOX $0.45 billion. The estimated monetary thousand tons of SO2, 5.93 thousand
emissions, and the 3-percent discount value of the health benefits from tons of NOX, 0.01 tons of Hg, 27.29
rate case for climate benefits from reduced SO2 and NOX emissions at TSL thousand tons of CH4, and 0.03
reduced GHG emissions, the estimated 3 is $0.25 billion using a 7-percent thousand tons of N2O. The estimated
total NPV at TSL 4 is $1.14 billion. discount rate and $0.80 billion using a monetary value of the climate benefits
Using a 3-percent discount rate for all 3-percent discount rate. from reduced GHG emissions
Using a 7-percent discount rate for (associated with the average SC–GHG at
benefits and costs, the estimated total

NPV at TSL 4 is $2.94 billion. consumer benefits and costs, health a 3-percent discount rate) at TSL 4 is
At TSL 4, the average LCC impact benefits from reduced SO2 and NOX $0.13 billion. The estimated monetary
ranges from $¥5,569 for equipment emissions, and the 3-percent discount value of the health benefits from
class 10 to $224 for equipment class 8. rate case for climate benefits from reduced SO2 and NOX emissions at TSL
The mean PBP ranges from 14.1 years reduced GHG emissions, the estimated 2 is $0.07 billion using a 7-percent
for equipment class 8 to 19.8 years for total NPV at TSL 3 is $0.97 billion. discount rate and $0.24 billion using a
equipment class 10. The fraction of Using a 3-percent discount rate for all 3-percent discount rate.
Using a 7-percent discount rate for average of consumers who experience a representing 78 percent of all MVDT
consumer benefits and costs, health net cost is 26 percent. The FFC national units shipped, additionally the
benefits from reduced SO2 and NOX energy savings are significant and the consumer benefits at EL 2, excluding
emissions, and the 3-percent discount NPV of consumer benefits is positive equipment class 10, increases from $641
rate case for climate benefits from using both a 3-percent and 7-percent to $1,271 in LCC savings Further, the EL
reduced GHG emissions, the estimated discount rate. Notably, the benefits to 2 represent an improvement in
total NPV at TSL 2 is $0.24 billion. consumers outweigh the cost to efficiency where the FFC national
Using a 3-percent discount rate for all manufacturers. At TSL 2, the NPV of energy savings is maximized, with
benefits and costs, the estimated total consumer benefits, even measured at the positive NPVs at both 3 and 7 percent,
NPV at TSL 2 is $0.58 billion. more conservative discount rate of 7 and the shipment weighted average
At TSL 2, the average LCC impact percent is over 38.3 times higher than consumer benefit at EL 2 is positive.
ranges from ¥$2,528 for equipment the maximum estimated manufacturers’ The shipment weighted consumer
class 10 to $3,016 for equipment class loss in INPV. The standard levels at TSL benefits for TSL, and EL 2 are shown in
8. The mean PBP ranges from 1.9 years 2 are economically justified even Table V.77.
for equipment class 8 to 24.9 years for without weighing the estimated As discussed previously, at the max-
equipment class 10, which is below the monetary value of emissions reductions. tech efficiency levels (TSL 5), TSL 4,
mean lifetime of 32 years. The fraction When those emissions reductions are and TSL 3 for all medium-voltage dry-
of consumers experiencing a net LCC included—representing $0.13 billion in type distribution transformers there is a
cost ranges from 11 percent for climate benefits (associated with the substantial risk to consumers due to
equipment class 8 to 83 percent for average SC–GHG at a 3-percent discount negative LCC savings for most
equipment class 10. rate), and $0.24 billion (using a 3- equipment, with a shipment weighted
At TSL 2, the projected change in percent discount rate) or $0.07 billion average consumer benefit of ¥$3,898,
INPV ranges from a decrease of $2.7 (using a 7-percent discount rate) in ¥$1,348, and ¥$1,139, respectively,
million to a decrease of $0.8 million, health benefits—the rationale becomes while at TSL 2 it is $641. Therefore,
which corresponds to decreases of 3.0 stronger still. DOE has tentatively concluded that the
percent and 0.9 percent, respectively. As stated, DOE conducts the walk- efficiency levels above TSL 2 are not
DOE estimates that industry must invest down analysis to determine the TSL that justified. Additionally, at the examined
$3.1 million to comply with standards represents the maximum improvement efficiency levels greater than TSL 2 DOE
set at TSL 2. in energy efficiency that is is estimating that a disproportionate
After considering the analysis and technologically feasible and fraction of consumers would be
weighing the benefits and burdens, the economically justified as required under negatively impacted by these efficiency
Secretary has tentatively concluded that EPCA. levels. DOE estimates that shipment
at a standard set at TSL 2 for medium- Although DOE considered proposed weighted fraction of negatively
voltage distribution transformers would amended standard levels for impacted consumers for TSL 3, TSL 4,
be economically justified. At this TSL, distribution by grouping the efficiency and TSL 5 (max-tech) to be 42, 46, and
the average LCC savings are positive levels for each equipment class into 58 percent, respectively.
across all equipment classes except for TSLs, DOE evaluates all analyzed Therefore, based on the previous
equipment class 10, with a shipment efficiency levels in its analysis. For considerations, DOE proposes to adopt
weighed average LCC for all medium- medium-voltage dry-type distribution the energy conservation standards for
voltage dry-type distribution transformer the TSL 2 maps directly to medium-voltage dry-type distribution
transformers of $641. An estimated 11 EL 2 for all equipment classes. EL 2 transformers at TSL 2. The proposed
percent of equipment class 8 to 83 represents a 10 percent reduction in amended energy conservation standards
percent of equipment class 10 medium- losses over the current standard. While for medium-voltage dry-type
voltage dry-type distribution the consumer benefits for equipment distribution transformers, which are
transformer consumers experience a net class 10 are negative at EL 2 at ¥$2,528, expressed as percentage efficiency at 50
cost, while the shipment weighted they are positive for all other equipment percent PUL are shown in Table V.78.
TABLE V.78—PROPOSED AMENDED ENERGY CONSERVATION STANDARDS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION
TRANSFORMERS
[Electrical efficiency by kVA and equipment class]
BIL BIL
kVA kVA
20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV
Equipment class EC5 EC7 EC9 EC6 EC8 EC10
15 .......................... 98.29 98.07 ........................ 15 .......................... 97.74 97.45 ........................

25 .......................... 98.49 98.30 ........................ 30 .......................... 98.11 97.86 ........................
37.5 ....................... 98.64 98.47 ........................ 45 .......................... 98.29 98.07 ........................
50 .......................... 98.74 98.58 ........................ 75 .......................... 98.49 98.31 ........................
75 .......................... 98.86 98.71 98.68 112.5 ..................... 98.67 98.52 ........................

100 ........................ 98.94 98.80 98.77 150 ........................ 98.78 98.66 ........................
167 ........................ 99.06 98.95 98.92 225 ........................ 98.94 98.82 98.71
250 ........................ 99.16 99.05 99.02 300 ........................ 99.04 98.93 98.82
333 ........................ 99.23 99.13 99.09 500 ........................ 99.18 99.09 99.00
500 ........................ 99.30 99.21 99.18 750 ........................ 99.29 99.21 99.12
667 ........................ 99.34 99.26 99.23 1000 ...................... 99.35 99.28 99.20
833 ........................ 99.38 99.31 99.28 1500 ...................... 99.43 99.37 99.29
TABLE V.78—PROPOSED AMENDED ENERGY CONSERVATION STANDARDS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION
TRANSFORMERS—Continued
[Electrical efficiency by kVA and equipment class]
BIL BIL
kVA kVA
20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV
Equipment class EC5 EC7 EC9 EC6 EC8 EC10
2000 ...................... 99.49 99.42 99.35

2500 ...................... 99.52 99.47 99.40
3750 ...................... 99.58 99.53 99.47
5000 ...................... 99.62 99.58 99.51
4. Annualized Benefits and Costs of the Table V.79 shows the annualized GHG reductions, and $495.3million
Proposed Standards for Liquid- values for the proposed standards for from reduced NOX and SO2 emissions.
Immersed Distribution Transformers distribution transformers, expressed in In this case, the net benefit amounts to
The benefits and costs of the proposed 2021$. The results under the primary $1,019.8 million per year.
standards can also be expressed in terms estimate are as follows. Using a 3-percent discount rate for all
of annualized values. The annualized Using a 7-percent discount rate for benefits and costs, the estimated cost of
net benefit is (1) the annualized national consumer benefits and costs and NOX the proposed standards for distribution
economic value (expressed in 2021$) of and SO2 reduction benefits, and a 3- transformers is $429.5 million per year
the benefits from operating products percent discount rate case for GHG in increased equipment costs, while the
that meet the proposed standards social costs, the estimated cost of the estimated annual benefits are $7,33.5
(consisting primarily of operating cost proposed standards for distribution million in reduced operating costs,
savings from using less energy, minus transformers is $424.8 million per year $497.4 million from GHG reductions,
increases in product purchase costs, and in increased equipment costs, while the and $894.3 million from reduced NOX
(2) the annualized monetary value of the estimated annual benefits are $451.9 and SO2 emissions. In this case, the net
climate and health benefits from million from reduced equipment benefit amounts to $1,695.8 million per
emission reductions. operating costs, $497.4 million from year.
TABLE V.79—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR LIQUID-
IMMERSED DISTRIBUTION TRANSFORMERS (TSL 4)
Million
2021$/year
Category
Primary esti- Low-net-bene- High-net-bene-
mate fits estimate fits estimate
3% discount rate
Consumer Operating Cost Savings ............................................................................................. 733.5 686.9 789.9

Climate Benefits * ......................................................................................................................... 497.4 478.9 519.5
Health Benefits ** ......................................................................................................................... 894.3 860.5 934.8
Total Benefits † ............................................................................................................................ 2,125.3 2,026.3 2,244.2
Consumer Incremental Equipment Costs ‡ ................................................................................. 429.5 449.0 413.2
Net Benefits ................................................................................................................................. 1,695.8 1,577.3 1,831.0
7% discount rate

Climate Benefits * (3% discount rate) .......................................................................................... 497.4 478.9 519.5
Health Benefits ** ......................................................................................................................... 495.3 477.9 515.3
Total Benefits † ............................................................................................................................ 1,444.7 1,382.5 1,517.0
Consumer Incremental Equipment Costs ‡ ................................................................................. 424.8 442.1 409.9
Net Benefits ................................................................................................................................. 1,019.8 940.5 1,107.2
This table presents the annualized costs and benefits associated with liquid-immersed distribution transformers equipment shipped in 2027–
2056. These results include benefits to consumers which accrue after 2055 from the products purchased in 2027–2056.
** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing PM2.5 and (for NOX) ozone
precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM2.5
emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L.2 of this document for more details.
5. Annualized Benefits and Costs of the Table V.80 shows the annualized GHG reductions, and $162.1 million
Proposed Standards for Low-Voltage values for the proposed standards for from reduced NOX and SO2 emissions.
Distribution Transformers distribution transformers, expressed in In this case, the net benefit amounts to
The benefits and costs of the proposed 2021$. The results under the primary $599.4 million per year.
economic value (expressed in 2021$) of and SO2 reduction benefits, and a 3- transformers is $219.3 million per year
the benefits from operating products percent discount rate case for GHG in increased equipment costs, while the
that meet the proposed standards social costs, the estimated cost of the estimated annual benefits are $772.1
(consisting primarily of operating cost proposed standards for distribution million in reduced operating costs,
savings from using less energy, minus transformers is $216.9 million per year $159.2 million from GHG reductions,
increases in product purchase costs, and in increased equipment costs, while the and $281.8 million from reduced NOX
(2) the annualized monetary value of the estimated annual benefits are $495.0 and SO2 emissions. In this case, the net
climate and health benefits from million from reduced equipment benefit amounts to $993.8 million per
emission reductions. operating costs, $159.2 million from year.
TABLE V.80—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR LOW-VOLTAGE
DISTRIBUTION TRANSFORMERS (TSL 5)
Million
2021$/year
Category
3% discount rate

Health Benefits ** ......................................................................................................................... 281.8 268.3 293.9
Total Benefits † ............................................................................................................................ 1,213.1 1,136.7 1,291.1
Consumer Incremental Product Costs ‡ ...................................................................................... 219.3 228.7 208.7
Net Benefits ................................................................................................................................. 993.8 908.0 1,082.4
7% discount rate

Health Benefits ** ......................................................................................................................... 162.1 154.9 168.2
Total Benefits † ............................................................................................................................ 816.3 769.3 862.8
Net Benefits ................................................................................................................................. 599.4 544.1 655.5
This table presents the annualized costs and benefits associated with low-voltage dry-type distribution transformers equipment shipped in
2027–2056. These results include benefits to consumers which accrue after 2055 from the products purchased in 2027–2056.
6. Annualized Benefits and Costs of the Table V.81 shows the annualized reductions, and $7.8 million from
Proposed Standards for Medium-Voltage values for the proposed standards for reduced NOX and SO2 emissions. In this
Distribution Transformers distribution transformers, expressed in case, the net benefit amounts to $19.5
The benefits and costs of the proposed 2021$. The results under the primary million per year.
economic value (expressed in 2021$) of and SO2 reduction benefits, and a 3- transformers is $11.0 million per year in
the benefits from operating products percent discount rate case for GHG increased equipment costs, while the
that meet the proposed standards social costs, the estimated cost of the estimated annual benefits are $23.3
(consisting primarily of operating cost proposed standards for distribution million in reduced operating costs, $7.6
savings from using less energy, minus transformers is $10.8 million per year in
million from GHG reductions, and $13.5
increases in product purchase costs, and increased equipment costs, while the
million from reduced NOX and SO2
(2) the annualized monetary value of the estimated annual benefits are $14.9
emissions. In this case, the net benefit
climate and health benefits from million from reduced equipment
emission reductions. operating costs, $7.6 million from GHG amounts to $33.5 million per year.
TABLE V.81—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR MEDIUM-
VOLTAGE DISTRIBUTION TRANSFORMERS (TSL 2)
Million
2021$/year
Category
3% discount rate

Health Benefits ** ......................................................................................................................... 13.5 13.2 14.5
Total Benefits † ............................................................................................................................ 44.4 42.9 48.5
Net Benefits ................................................................................................................................. 33.5 31.1 37.7
7% discount rate

Health Benefits ** ......................................................................................................................... 7.8 7.6 8.3
Total Benefits † ............................................................................................................................ 30.3 29.4 32.9
Net Benefits ................................................................................................................................. 19.5 17.9 22.2
This table presents the annualized costs and benefits associated with medium-voltage dry-type distribution transformers equipment shipped in
2027¥2056. These results include benefits to consumers which accrue after 2055 from the products purchased in 2027¥2056.
Climate benefits are calculated using four different estimates of the social cost of carbon (SC–CO2), methane (SC–CH4), and nitrous oxide
7. Benefits and Costs of the Proposed proposing TSL 4 for liquid-immersed, benefits, and Table V.83 shows the
Standards for all Considered TSL 5 for low-voltage dry-type, and TSL combined annualized benefits for the
Distribution Transformers 2 for medium-voltage dry-type proposed levels for all distribution
As described in sections V.C.1 distribution transformers. Table VI.1 transformers.
through V.C.6, for this NOPR DOE is shows the combined cumulative
TABLE V.82—SUMMARY OF MONETIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR
ALL DISTRIBUTION TRANSFORMERS AT PROPOSED STANDARD LEVELS
Billion $2021
3% discount rate
Consumer Operating Cost Savings ..................................................................................................................................... 26.63

Climate Benefits * ................................................................................................................................................................. 11.56
Health Benefits ** ................................................................................................................................................................. 20.72
Total Benefits † .................................................................................................................................................................... 58.91
Consumer Incremental Product Costs ‡ .............................................................................................................................. 11.49
Net Benefits ......................................................................................................................................................................... 47.42
7% discount rate

Climate Benefits * (3% discount rate) .................................................................................................................................. 11.56
Health Benefits ** ................................................................................................................................................................. 6.29
Total Benefits † .................................................................................................................................................................... 26.97
Net Benefits ......................................................................................................................................................................... 20.79
cursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as
TABLE V.8384—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR ALL
DISTRIBUTION TRANSFORMERS AT PROPOSED STANDARD LEVELS
Million
2021$/year
Category
3% discount rate
Consumer Operating Cost Savings ............................................................................................. 1,528.9 1,426.0 1,647.0

Health Benefits ** ......................................................................................................................... 1,189.6 1,142.0 1,243.2
Total Benefits † ............................................................................................................................ 3,382.8 3,205.9 3,583.8
Net Benefits ................................................................................................................................. 2,723.1 2,516.4 2,951.1
7% discount rate
Consumer Operating Cost Savings ............................................................................................. 961.8 902.8 1,027.3

Health Benefits ** ......................................................................................................................... 665.2 640.4 691.8
Total Benefits † ............................................................................................................................ 2,291.3 2,181.2 2,412.7
Net Benefits ................................................................................................................................. 1,638.7 1,502.5 1,784.9
value. DOE is currently only monetizing (for SOX and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but
D. Reporting, Certification, and 13563, ‘‘Improving Regulation and adopt; and (5) identify and assess
Sampling Plan Regulatory Review, 76 FR 3821 (Jan. 21, available alternatives to direct
2011), requires agencies, to the extent regulation, including providing
Manufacturers, including importers,
permitted by law, to (1) propose or economic incentives to encourage the
must use product-specific certification
adopt a regulation only upon a reasoned desired behavior, such as user fees or
templates to certify compliance to DOE.
determination that its benefits justify its marketable permits, or providing
For distribution transformers, the
costs (recognizing that some benefits information upon which choices can be
certification template reflects the
and costs are difficult to quantify); (2) made by the public. DOE emphasizes as
general certification requirements
tailor regulations to impose the least well that E.O. 13563 requires agencies to
specified at 10 CFR 429.12 and the
burden on society, consistent with use the best available techniques to
product-specific requirements specified
obtaining regulatory objectives, taking quantify anticipated present and future
at 10 CFR 429.47. As discussed in the
into account, among other things, and to benefits and costs as accurately as
previous paragraphs, DOE is not
the extent practicable, the costs of possible. In its guidance, the Office of
proposing to amend the product-specific
cumulative regulations; (3) select, in Information and Regulatory Affairs
certification requirements for this
choosing among alternative regulatory (‘‘OIRA’’) in the Office of Management
equipment.
approaches, those approaches that and Budget (‘‘OMB’’) has emphasized
VI. Procedural Issues and Regulatory maximize net benefits (including that such techniques may include
Review potential economic, environmental, identifying changing future compliance

public health and safety, and other costs that might result from
A. Review Under Executive Orders
advantages; distributive impacts; and technological innovation or anticipated
12866 and 13563
equity); (4) to the extent feasible, specify behavioral changes. For the reasons
Executive Order (‘‘E.O.’’)12866, performance objectives, rather than stated in the preamble, this proposed/
‘‘Regulatory Planning and Review,’’ as specifying the behavior or manner of final regulatory action is consistent with
supplemented and reaffirmed by E.O. compliance that regulated entities must these principles.
Section 6(a) of E.O. 12866 also including the underlying analysis, of planned regulatory action is preferable
requires agencies to submit ‘‘significant benefits and costs anticipated from the to the identified potential alternatives.
regulatory actions’’ to OIRA for review. proposed regulatory action, together These assessments are summarized in
OIRA has determined that this proposed with, to the extent feasible, a this preamble and further detail can be
regulatory action constitutes an quantification of those costs; and an found in the technical support
economically significant regulatory assessment, including the underlying document for this rulemaking. A
action under section 3(f) of E.O. 12866. analysis, of costs and benefits of summary of the potential costs and
Accordingly, pursuant to section potentially effective and reasonably benefits of the regulatory action is
6(a)(3)(C) of E.O. 12866, DOE has feasible alternatives to the planned presented in Table VI.1 and Table VI.2.
provided to OIRA an assessment, regulation, and an explanation why the
TABLE VI.1—SUMMARY OF MONETIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR
ALL DISTRIBUTION TRANSFORMERS AND PROPOSED STANDARD LEVELS
Billion $2021
3% discount rate

Climate Benefits * ................................................................................................................................................................. 11.56
Health Benefits ** ................................................................................................................................................................. 20.72
Total Benefits † .................................................................................................................................................................... 58.91
Net Benefits ......................................................................................................................................................................... 47.42
7% discount rate

Climate Benefits * (3% discount rate) .................................................................................................................................. 11.56
Health Benefits ** ................................................................................................................................................................. 6.29
Total Benefits † .................................................................................................................................................................... 26.97
Net Benefits ......................................................................................................................................................................... 20.79
cursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as
TABLE VI.2—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR ALL
DISTRIBUTION TRANSFORMERS AND PROPOSED STANDARD LEVELS
Million 2021$/year
Category Primary esti- Low-net-bene- High-net-bene-
3% discount rate
Consumer Operating Cost Savings ............................................................................................. 1,528.9 1,426.0 1,647.0

Health Benefits ** ......................................................................................................................... 1,189.6 1,142.0 1,243.2

Total Benefits † ............................................................................................................................ 3,382.8 3,205.9 3,583.8
Net Benefits ................................................................................................................................. 2,723.1 2,516.4 2,951.1
7% discount rate
Consumer Operating Cost Savings ............................................................................................. 961.8 902.8 1,027.3
TABLE VI.2—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR ALL
DISTRIBUTION TRANSFORMERS AND PROPOSED STANDARD LEVELS—Continued
Million 2021$/year
Category Primary esti- Low-net-bene- High-net-bene-

Health Benefits ** ......................................................................................................................... 665.2 640.4 691.8
Total Benefits † ............................................................................................................................ 2,291.3 2,181.2 2,412.7
Net Benefits ................................................................................................................................. 1,638.7 1,502.5 1,784.9
value. DOE is currently only monetizing (for SOX and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but
B. Review Under the Regulatory the rule. (See 13 CFR part 121.) The size achieve the maximum improvement in
Flexibility Act standards are listed by North American energy efficiency that the Secretary of
Industry Classification System Energy determines is technologically
The Regulatory Flexibility Act (5
(‘‘NAICS’’) code and industry feasible and economically justified. (42
U.S.C. 601 et seq.) requires preparation
description and are available at U.S.C. 6316(a); 42 U.S.C. 6295(o)(2)(A)
of an initial regulatory flexibility
www.sba.gov/document/support--table- and 42 U.S.C. 6295(o)(3)(B)).
analysis (‘‘IRFA’’) for any rule that by
size-standards. Manufacturing of
law must be proposed for public 3. Description on Estimated Number of
distribution transformers is classified
comment, unless the agency certifies Small Entities Regulated
under NAICS 335311, ‘‘Power,
that the rule, if promulgated, will not DOE conducted a more focused
Distribution, and Specialty Transformer
have a significant economic impact on inquiry of the companies that could be
Manufacturing.’’ The SBA sets a
a substantial number of small entities. small businesses that manufacture
threshold of 750 employees or fewer for
As required by E.O. 13272, ‘‘Proper distribution transformers covered by
an entity to be considered as a small
Consideration of Small Entities in this rulemaking. DOE used publicly
business for this category.
Agency Rulemaking,’’ 67 FR 53461 available information to identify
(Aug. 16, 2002), DOE published 1. Description of Reasons Why Action Is potential small businesses. DOE’s
procedures and policies on February 19, Being Considered research involved industry trade
2003, to ensure that the potential EPCA requires that, not later than 6 association membership directories
impacts of its rules on small entities are years after the issuance of any final rule (including NEMA), DOE’s publicly
properly considered during the establishing or amending a standard, available Compliance Certification
rulemaking process. 68 FR 7990. DOE DOE must publish either a notice of Database (‘‘CCD’’), California Energy
has made its procedures and policies determination that standards for the Commission’s MAEDBS database to
available on the Office of the General product do not need to be amended, or create a list of companies that
Counsel’s website www.energy.gov/gc/ a NOPR including new proposed energy manufacture or sell distribution
office-general-counsel. DOE has conservation standards (proceeding to a transformers covered by this
prepared the following IRFA for the final rule, as appropriate). (42 U.S.C. rulemaking. DOE also asked
products that are the subject of this 6316(e)(1); 42 U.S.C. 6295(m)(1)). stakeholders and industry
rulemaking. representatives if they were aware of
For manufacturers of distribution 2. Objectives of, and Legal Basis for, any other small businesses during
transformers, the SBA has set a size Rule manufacturer interviews. DOE contacted
threshold, which defines those entities DOE must follow specific statutory select companies on its list, as
classified as ‘‘small businesses’’ for the criteria for prescribing new or amended necessary, to determine whether they
purposes of the statute. DOE used the standards for covered equipment, met the SBA’s definition of a small
SBA’s small business size standards to including distribution transformers. business that manufacturers distribution
determine whether any small entities Any new or amended standard for a transformers covered by this
would be subject to the requirements of covered product must be designed to rulemaking. DOE screened out
companies that did not offer products distribution transformers covered by LVDT distribution transformer
covered by this rulemaking, did not this rulemaking. None of these four equipment classes.
meet the definition of a ‘‘small major LVDT distribution transformer Based on the LCC consumer choice
business,’’ or are foreign owned and manufacturers are small businesses. The model, DOE anticipates that most, if not
operated. majority of LVDT distribution all, liquid-immersed and LVDT
DOE’s analysis identified 29 transformers are manufactured outside distribution transformer manufacturers
companies that sell or manufacture the U.S., mostly in Canada and Mexico. would use amorphous cores in their
distribution transformers coved by this The customer base rarely purchases on distribution transformers to meet these
rulemaking in the U.S. market. At least efficiency and is very first-cost proposed amended energy conservation
two of these companies are not the conscious, which, in turn, places a standards. While DOE anticipates that
original equipment manufacturers premium on economies of scale in several large liquid-immersed and LVDT
(‘‘OEM’’) and instead privately label manufacturing. However, there are distribution transformer manufacturers
distribution transformers that are universities and other buildings that would make significant capital
manufactured by another distribution purchase LVDT based on efficiency as investments to accommodate the
transformer manufacturer. Of the 27 more and more organizations are production of amorphous cores, DOE
companies that are OEMs, DOE striving to get to reduced or net-zero does not anticipate that any small
identified 10 potential companies that emission targets. businesses will make these capital
have fewer than 750 total employees In the LVDT market, lower volume investments to be able to produce their
and are not entirely foreign owned and manufacturers typically do not compete own amorphous cores, based on the
operated. There are three small directly with larger volume large capital investments need to be able
businesses that manufacture liquid- manufacturers, as these lower volume to make amorphous cores and the
immersed distribution transformers; manufacturers are frequently not able to limited ability for small businesses to
there are three small businesses that compete on a first cost basis. However, access large capital investments. Based
manufacture LVDT and MVDT there are lower volume manufactures on manufacturer interviews and market
distribution transformers; and there are that do serve customers that purchase research, DOE was able to identify one
four small businesses that only more efficient LVDT distribution LVDT small business that manufactures
manufacture LVDT distribution transformers. Lastly, there are some their own cores and was not able to
transformers.115 smaller firms that focus on the identify any liquid-immersed small
engineering and design of LVDT businesses that manufacture their own
Liquid-Immersed
distribution transformers and source the cores. The one LVDT small business
Liquid-immersed distribution that is currently manufacturing their
production of some parts of the
transformers account for over 80 percent own cores would have to make a
of all distribution transformer distribution transformer, most
frequently the cores, to another business decision to either make a
shipments covered by this rulemaking. significant capital investment to be able
Six major manufacturers supply more company that manufactures those
components. to make amorphous cores or to out-
than 80 percent of the market for liquid- source the production of their LVDT
immersed distribution transformers Medium-Voltage Dry-Type cores. Out-sourcing the production of
covered by this rulemaking. None of their cores would be a significant
MVDT distribution transformers
these six major manufacturers of liquid- change in their production process and
account for less than one percent of all
immersed distribution transformers are could result in a reduction in this small
distribution transformer shipments
small businesses. Most liquid-immersed business’ market share in the LVDT
covered by this rulemaking. There is
distribution transformers are distribution transformer market.
manufactured domestically. Electric one large MVDT distribution
DOE acknowledges that there is
utilities compose the customer base and transformer manufacturer with a
uncertainty if these small businesses
typically buy on a first-cost basis. Many substantial share of the market. The rest
will be able to find core manufacturers
small manufacturers position of MVDT distribution transformer
that will supply them with amorphous
themselves towards the higher end of market is served by a mix of large and
cores in order to comply with the
the market or in particular product small manufactures. Most MVDT
proposed energy conservation standards
niches, such as network transformers or distribution transformers are
for liquid-immersed and LVDT
harmonic mitigating transformers, but, manufactured domestically. Electric
distribution transformers. DOE
in general, competition is based on price utilities and industrial users make up
anticipates that there will be an increase
after a given unit’s specs are prescribed most of the customer base and typically in the number of large liquid-immersed
by a customer. None of the three small buy on first-cost or features other than and LVDT distribution transformer
businesses have a market share larger efficiency. manufacturers that will out-source the
than five percent of the liquid-immersed 4. Description and Estimate of production of their cores to core
distribution transformer market. Compliance Requirements Including manufacturers capable of producing
Low-Voltage Dry Type Differences in Cost, if Any, for Different amorphous cores. This could increase
Groups of Small Entities the competition for small businesses to
LVDT distribution transformers procure amorphous cores for their
account for approximately 18 percent of Liquid-Immersed and Low-Voltage Dry-
distribution transformers. Small
all distribution shipments covered by Type
businesses manufacturing liquid-
this rulemaking. Four major DOE is proposing to amend energy
immersed and LVDT distribution

manufacturers supply more than 80 conservation standards to be at TSL 4 transformers must be able to procure
percent of the market for LVDT for liquid-immersed distribution amorphous cores suitable for their
transformers and TSL 5 for LVDT distribution transformers at a cost that
115 Therefore, there are a total of seven small
distribution transformers. This allows them to continue to be
businesses that manufacture LVDT distribution
transformers. Four that exclusively manufacture
corresponds to EL 4 for most liquid- competitive in the market.
LVDT and three that manufacture both LVDT and immersed distribution transformer Based on feedback received during
MVDT. equipment classes and EL 5 for all manufacturer interviews, DOE does not
anticipate that small businesses that are efficiency levels, while not using at the expense of a reduction in energy
currently not producing their own cores amorphous cores. Based on the financial savings. For liquid-immersed equipment
would have to make a significant capital parameters used in the GRIM, DOE classes TSL 1 achieves 60 percent lower
investment in their production lines to estimated that the normal annual R&D is energy savings compared to the energy
be able to use amorphous cores, that are approximately 3.0 percent of annual savings at TSL 4; TSL 2 achieves 37
purchased from a core manufacturer, in revenue. Therefore, MVDT small percent lower energy savings compared
the distribution transformers that they businesses would include an additional to the energy savings at TSL 4. For
manufacture. There will be some 1.5 percent of annual revenue to LVDT equipment classes TSL 1 achieves
additional product conversion costs, in redesign, MVDT distribution 85 percent lower energy savings
the form of additional R&D and testing, transformers to higher efficiency levels compared to the energy savings at TSL
that will need to be incurred by small that could be met without using 5; TSL 2 achieves 78 percent lower
businesses that manufacture liquid- amorphous cores. energy savings compared to the energy
immersed and LVDT distribution DOE requests comment on the savings at TSL 5; TSL 3 achieves 66
transformers, even if they do not number of small businesses identified percent lower energy savings compared
manufacture their own cores. The that manufacture distribution to the energy savings at TSL 5; and TSL
methodology used to calculate product transformers covered by this rulemaking 4 achieves 8 percent lower energy
conversion costs, described in section (three small liquid-immersed and seven savings compared to the energy savings
IV.J.2.c, estimates that manufacturers LVDT small businesses; three of which at TSL 5. For MVDT equipment classes
would incur approximately one also manufacture MVDT). Additionally, TSL 1 achieves 33 percent lower energy
additional year of R&D expenditure to DOE requests comment on its initial savings compared to the energy savings
redesign their distribution transformers assumption that only one LVDT small at TSL 2.
to be capable of accommodating the use business and no liquid-immersed small Based on the presented discussion,
of an amorphous core. Based on the businesses manufacturer their own DOE tentatively concludes that the
financial parameters used in the GRIM, cores used in their distribution benefits of the energy savings from TSL
DOE estimated that the normal annual transformers. 4 for liquid-immersed equipment
R&D is approximately 3.0 percent of classes; TSL 5 for LVDT equipment
5. Duplication, Overlap, and Conflict
annual revenue. Therefore, liquid- classes; and TSL 2 for MVDT equipment
With Other Rules and Regulations
immersed and LVDT small businesses classes exceed the potential burdens
would incur an additional 3.0 percent of Starting in 2018, imports of raw placed on distribution transformers
annual revenue to redesign their electrical steel have been subject to a 25 manufacturers, including small business
distribution transformers to be able to percent ad valorem tariff. This tariff manufacturers. Accordingly, DOE does
accommodate using amorphous cores does not apply to products made from not propose one of the other TSLs
there were purchased from core electrical steel, such as transformer considered in the analysis, or the other
manufacturers. laminations and finished cores. In a policy alternatives examined as part of
report published on November 18, 2021, the regulatory impact analysis and
Medium-Voltage Dry-Type the Department of Commerce presented included in chapter 17 of the NOPR
DOE is proposing to amend energy its conclusions and potential options to TSD.
conservation standards to be at TSL 2 ensure the domestic supply chain of Additional compliance flexibilities
for MVDT distribution transformers. electrical steel and transformer may be available through other means.
This corresponds to EL 2 for all MVDT components. 86 FR 64606 However, no EPCA provides that a manufacturer
distribution transformer equipment modifications to the tariff structure have whose annual gross revenue from all of
classes. Based on the LCC consumer been made at the time of publication of its operations does not exceed $8
choice model, DOE does not anticipate this NOPR. As discussed in section million may apply for an exemption
that any MVDT distribution transformer IV.A.5, modification to the tariff from all or part of an energy
manufacturers would use amorphous structure could impact the pricing and conservation standard for a period not
cores in their MVDT distribution availability of certain electrical steel longer than 24 months after the effective
transformers to meet these proposed grades depending on each date of a final rule establishing the
energy conservation standards. DOE manufacturer’s given supply chain and standard. (42 U.S.C. 6295(t))
does not anticipate that MVDT sourcing practices. Additionally, manufacturers subject to
manufacturers would make significant DOE is not aware of any other rules DOE’s energy efficiency standards may
investments to either be able to produce or regulations that duplicate, overlap, or apply to DOE’s Office of Hearings and
cores capable of meeting these proposed conflict with the rule being considered Appeals for exception relief under
amended energy conservation standards today. certain circumstances. Manufacturers
or be able to integrate more efficient should refer to 10 CFR part 430, subpart
purchased cores from core 6. Significant Alternatives to the Rule
E, and 10 CFR part 1003 for additional
manufacturers. There will be some The discussion in the previous details.
additional product conversion costs, in section analyzes impacts on small
the form of additional R&D and testing, businesses that would result from DOE’s C. Review Under the Paperwork
that will need to be incurred by small proposed rule, represented by TSL 4 for Reduction Act
businesses that manufacture MVDT liquid-immersed distribution Manufacturers of distribution
distribution transformers, even if they transformer equipment classes; TSL 5 transformers must certify to DOE that
do not manufacture their own cores. for LVDT equipment classes; and TSL 2 their products comply with any
The methodology used to calculate for MVDT equipment classes. In applicable energy conservation
product conversion costs, described in reviewing alternatives to the proposed standards. In certifying compliance,
section IV.J.2.c, estimates that rule, DOE examined energy manufacturers must test their products
manufacturers would incur conservation standards set at lower according to the DOE test procedures for
approximately a half of a year of efficiency levels. While lower TSLs distribution transformers, including any
additional R&D expenditure to redesign would reduce the impacts on small amendments adopted for those test
their distribution transformers to higher business manufacturers, it would come procedures. DOE has established
regulations for the certification and of the States and to carefully assess the review and determined that, to the
recordkeeping requirements for all necessity for such actions. The extent permitted by law, this proposed
covered consumer products and Executive order also requires agencies to rule meets the relevant standards of E.O.
commercial equipment, including have an accountable process to ensure 12988.
distribution transformers. (See generally meaningful and timely input by State
G. Review Under the Unfunded
10 CFR part 429). The collection-of- and local officials in the development of
Mandates Reform Act of 1995
information requirement for the regulatory policies that have federalism
certification and recordkeeping is implications. On March 14, 2000, DOE Title II of the Unfunded Mandates
subject to review and approval by OMB published a statement of policy Reform Act of 1995 (‘‘UMRA’’) requires
under the Paperwork Reduction Act describing the intergovernmental each Federal agency to assess the effects
(‘‘PRA’’). This requirement has been consultation process it will follow in the of Federal regulatory actions on State,
approved by OMB under OMB control development of such regulations. 65 FR local, and Tribal governments and the
number 1910–1400. Public reporting 13735. DOE has examined this proposed private sector. Public Law 104–4,
burden for the certification is estimated rule and has tentatively determined that section 201 (codified at 2 U.S.C. 1531).
to average 35 hours per response, it would not have a substantial direct For a proposed regulatory action likely
including the time for reviewing effect on the States, on the relationship to result in a rule that may cause the
instructions, searching existing data between the national government and expenditure by State, local, and Tribal
sources, gathering and maintaining the the States, or on the distribution of governments, in the aggregate, or by the
data needed, and completing and power and responsibilities among the private sector of $100 million or more
reviewing the collection of information. various levels of government. EPCA in any one year (adjusted annually for
Notwithstanding any other provision governs and prescribes Federal inflation), section 202 of UMRA requires
of the law, no person is required to preemption of State regulations as to a Federal agency to publish a written
respond to, nor shall any person be energy conservation for the equipment statement that estimates the resulting
subject to a penalty for failure to comply that are the subject of this proposed costs, benefits, and other effects on the
with, a collection of information subject rule. States can petition DOE for national economy. (2 U.S.C. 1532(a), (b))
to the requirements of the PRA, unless exemption from such preemption to the The UMRA also requires a Federal
that collection of information displays a extent, and based on criteria, set forth in agency to develop an effective process
currently valid OMB Control Number. EPCA. (42 U.S.C. 6297) Therefore, no to permit timely input by elected
further action is required by Executive officers of State, local, and Tribal
D. Review Under the National governments on a proposed ‘‘significant
Environmental Policy Act of 1969 Order 13132.
intergovernmental mandate,’’ and
DOE is analyzing this proposed F. Review Under Executive Order 12988 requires an agency plan for giving notice
regulation in accordance with the With respect to the review of existing and opportunity for timely input to
National Environmental Policy Act of regulations and the promulgation of potentially affected small governments
1969 (‘‘NEPA’’) and DOE’s NEPA new regulations, section 3(a) of E.O. before establishing any requirements
implementing regulations (10 CFR part 12988, ‘‘Civil Justice Reform,’’ imposes that might significantly or uniquely
1021). DOE’s regulations include a on Federal agencies the general duty to affect them. On March 18, 1997, DOE
categorical exclusion for rulemakings adhere to the following requirements: published a statement of policy on its
that establish energy conservation (1) eliminate drafting errors and process for intergovernmental
standards for consumer products or ambiguity, (2) write regulations to consultation under UMRA. 62 FR
industrial equipment. 10 CFR part 1021, minimize litigation, (3) provide a clear 12820. DOE’s policy statement is also
subpart D, appendix B5.1. DOE legal standard for affected conduct available at www.energy.gov/sites/prod/
anticipates that this rulemaking rather than a general standard, and (4) files/gcprod/documents/umra_97.pdf.
qualifies for categorical exclusion B5.1 promote simplification and burden Although this proposed rule does not
because it is a rulemaking that reduction. 61 FR 4729 (Feb. 7, 1996). contain a Federal intergovernmental
establishes energy conservation Regarding the review required by mandate, it may require expenditures of
standards for consumer products or section 3(a), section 3(b) of E.O. 12988 $100 million or more in any one year by
industrial equipment, none of the specifically requires that Executive the private sector. Such expenditures
exceptions identified in categorical agencies make every reasonable effort to may include: (1) investment in research
exclusion B5.1(b) apply, no ensure that the regulation: (1) clearly and development and in capital
extraordinary circumstances exist that specifies the preemptive effect, if any, expenditures by distribution
require further environmental analysis, (2) clearly specifies any effect on transformers manufacturers in the years
and it otherwise meets the requirements existing Federal law or regulation, (3) between the final rule and the
for application of a categorical provides a clear legal standard for compliance date for the new standards
exclusion. See 10 CFR 1021.410. DOE affected conduct while promoting and (2) incremental additional
will complete its NEPA review before simplification and burden reduction, (4) expenditures by consumers to purchase
issuing the final rule. specifies the retroactive effect, if any, (5) higher-efficiency distribution
adequately defines key terms, and (6) transformers, starting at the compliance
E. Review Under Executive Order 13132 addresses other important issues date for the applicable standard.
E.O. 13132, ‘‘Federalism,’’ 64 FR affecting clarity and general Section 202 of UMRA authorizes a
43255 (Aug. 10, 1999), imposes certain draftsmanship under any guidelines Federal agency to respond to the content
requirements on Federal agencies issued by the Attorney General. Section requirements of UMRA in any other
formulating and implementing policies 3(c) of Executive Order 12988 requires statement or analysis that accompanies
or regulations that preempt State law or Executive agencies to review regulations the proposed rule. (2 U.S.C. 1532(c))
that have federalism implications. The in light of applicable standards in The content requirements of section
Executive order requires agencies to section 3(a) and section 3(b) to 202(b) of UMRA relevant to a private
examine the constitutional and statutory determine whether they are met or it is sector mandate substantially overlap the
authority supporting any action that unreasonable to meet one or more of economic analysis requirements that
would limit the policymaking discretion them. DOE has completed the required apply under section 325(o) of EPCA and
Executive Order 12866. The for Federal agencies to review most Bulletin’’). 70 FR 2664 (Jan. 14, 2005).
SUPPLEMENTARY INFORMATION section of disseminations of information to the The Bulletin establishes that certain
this NOPR and the TSD for this public under information quality scientific information shall be peer
proposed rule respond to those guidelines established by each agency reviewed by qualified specialists before
requirements. pursuant to general guidelines issued by it is disseminated by the Federal
Under section 205 of UMRA, the OMB. OMB’s guidelines were published Government, including influential
Department is obligated to identify and at 67 FR 8452 (Feb. 22, 2002), and scientific information related to agency
consider a reasonable number of DOE’s guidelines were published at 67 regulatory actions. The purpose of the
regulatory alternatives before FR 62446 (Oct. 7, 2002). Pursuant to bulletin is to enhance the quality and
promulgating a rule for which a written OMB Memorandum M–19–15, credibility of the Government’s
statement under section 202 is required. Improving Implementation of the scientific information. Under the
(2 U.S.C. 1535(a)) DOE is required to Information Quality Act (April 24, Bulletin, the energy conservation
select from those alternatives the most 2019), DOE published updated standards rulemaking analyses are
cost-effective and least burdensome guidelines which are available at ‘‘influential scientific information,’’
alternative that achieves the objectives www.energy.gov/sites/prod/files/2019/ which the Bulletin defines as ‘‘scientific
of the proposed rule unless DOE 12/f70/DOE%20Final information the agency reasonably can
publishes an explanation for doing %20Updated%20IQA determine will have, or does have, a
otherwise, or the selection of such an %20Guidelines%20Dec%202019.pdf. clear and substantial impact on
alternative is inconsistent with law. As DOE has reviewed this NOPR under the important public policies or private
required by 42 U.S.C. 6295(m) [or a OMB and DOE guidelines and has sector decisions.’’ 70 FR 2664, 2667.
product-specific directive in 42 U.S.C. concluded that it is consistent with In response to OMB’s Bulletin, DOE
6295 or 42 U.S.C. 6313], this proposed applicable policies in those guidelines. conducted formal peer reviews of the
rule would establish amended energy energy conservation standards
K. Review Under Executive Order 13211 development process and the analyses
conservation standards for distribution
transformers that are designed to E.O. 13211, ‘‘Actions Concerning that are typically used and has prepared
achieve the maximum improvement in Regulations That Significantly Affect a report describing that peer review.116
energy efficiency that DOE has Energy Supply, Distribution, or Use,’’ 66 Generation of this report involved a
determined to be both technologically FR 28355 (May 22, 2001), requires rigorous, formal, and documented
feasible and economically justified, as Federal agencies to prepare and submit evaluation using objective criteria and
required by 42 U.S.C. 6295(o)(2)(A) and to OIRA at OMB, a Statement of Energy qualified and independent reviewers to
42 U.S.C. 6295(o)(3)(B). A full Effects for any proposed significant make a judgment as to the technical/
discussion of the alternatives energy action. A ‘‘significant energy scientific/business merit, the actual or
considered by DOE is presented in action’’ is defined as any action by an anticipated results, and the productivity
chapter 17 of the TSD for this proposed agency that promulgates or is expected and management effectiveness of
rule. to lead to promulgation of a final rule, programs and/or projects. Because
and that (1) is a significant regulatory available data, models, and
H. Review Under the Treasury and action under Executive Order 12866, or technological understanding have
General Government Appropriations any successor order; and (2) is likely to changed since 2007, DOE has engaged
Act, 1999 have a significant adverse effect on the with the National Academy of Sciences
Section 654 of the Treasury and supply, distribution, or use of energy, or to review DOE’s analytical
General Government Appropriations (3) is designated by the Administrator of methodologies to ascertain whether
Act, 1999 (Pub. L. 105–277) requires OIRA as a significant energy action. For modifications are needed to improve the
Federal agencies to issue a Family any proposed significant energy action, Department’s analyses. DOE is in the
Policymaking Assessment for any rule the agency must give a detailed process of evaluating the resulting
that may affect family well-being. This statement of any adverse effects on report.117
proposed rule would not have any energy supply, distribution, or use
impact on the autonomy or integrity of should the proposal be implemented, VII. Public Participation
the family as an institution. and of reasonable alternatives to the A. Attendance at the Public Meeting
Accordingly, DOE has concluded that it action and their expected benefits on
The time and date of the webinar
is not necessary to prepare a Family energy supply, distribution, and use.
DOE has tentatively concluded that meeting are listed in the DATES section
Policymaking Assessment. at the beginning of this document.
this regulatory action, which proposes
I. Review Under Executive Order 12630 amended energy conservation standards Webinar registration information,
Pursuant to E.O. 12630, for distribution transformers, is not a participant instructions, and
‘‘Governmental Actions and Interference significant energy action because the information about the capabilities
with Constitutionally Protected Property proposed standards are not likely to available to webinar participants will be
Rights,’’ 53 FR 8859 (Mar. 15, 1988), have a significant adverse effect on the published on DOE’s website:
DOE has determined that this proposed supply, distribution, or use of energy, www.eere.energy.gov/buildings/
rule would not result in any takings that nor has it been designated as such by appliance_standards/
might require compensation under the the Administrator at OIRA. Accordingly, standards.aspx?productid=55.
Fifth Amendment to the U.S. DOE has not prepared a Statement of 116 The 2007 ‘‘Energy Conservation Standards
Constitution. Energy Effects on this proposed rule. Rulemaking Peer Review Report’’ is available at the
following website: energy.gov/eere/buildings/
J. Review Under the Treasury and L. Information Quality downloads/energy-conservation-standards-
General Government Appropriations On December 16, 2004, OMB, in rulemaking-peer-review-report-0 (last accessed
Act, 2001 consultation with the Office of Science January 2022).
117 The report is available at
Section 515 of the Treasury and and Technology Policy (‘‘OSTP’’), www.nationalacademies.org/our-work/review-of-
General Government Appropriations issued its Final Information Quality methods-for-setting-building-and-equipment-
Act, 2001 (44 U.S.C. 3516 note) provides Bulletin for Peer Review (‘‘the performance-standards.
Participants are responsible for ensuring participant will be allowed to make a permit, as time permits, other
their systems are compatible with the general statement (within time limits participants to comment briefly on any
webinar software. determined by DOE), before the general statements.
discussion of specific topics. DOE will At the end of all prepared statements
B. Procedure for Submitting Prepared on a topic, DOE will permit participants
permit, as time permits, other
General Statements for Distribution to clarify their statements briefly.
participants to comment briefly on any
Any person who has an interest in the general statements. Participants should be prepared to
topics addressed in this proposed rule, At the end of all prepared statements answer questions by DOE and by other
or who is representative of a group or on a topic, DOE will permit participants participants concerning these issues.
class of persons that has an interest in to clarify their statements briefly. DOE representatives may also ask
these issues, may request an Participants should be prepared to questions of participants concerning
opportunity to make an oral answer questions by DOE and by other other matters relevant to this
presentation at the webinar. Such participants concerning these issues. rulemaking. The official conducting the
persons may submit to DOE representatives may also ask webinar/public meeting will accept
ApplianceStandardsQuestions@ questions of participants concerning additional comments or questions from
ee.doe.gov. Persons who wish to speak other matters relevant to this proposed those attending, as time permits. The
should include with their request a rule. The official conducting the presiding official will announce any
computer file in WordPerfect, Microsoft webinar/public meeting will accept further procedural rules or modification
Word, PDF, or text (ASCII) file format additional comments or questions from of the above procedures that may be
that briefly describes the nature of their those attending, as time permits. The needed for the proper conduct of the
interest in this rulemaking and the presiding official will announce any webinar.
topics they wish to discuss. Such further procedural rules or modification A transcript of the webinar will be
persons should also provide a daytime of the above procedures that may be included in the docket, which can be
telephone number where they can be needed for the proper conduct of the viewed as described in the Docket
reached. webinar. section at the beginning of this proposed
DOE requests persons selected to A transcript of the webinar will be rule. In addition, any person may buy a
make an oral presentation to submit an included in the docket, which can be copy of the transcript from the
advance copy of their statements at least viewed as described in the Docket transcribing reporter.
two weeks before the webinar. At its section at the beginning of this proposed
discretion, DOE may permit persons D. Submission of Comments
rule. In addition, any person may buy a
who cannot supply an advance copy of copy of the transcript from the DOE will accept comments, data, and
their statement to participate, if those transcribing reporter. information regarding this proposed
persons have made advance alternative rule before or after the public meeting,
arrangements with the Building C. Conduct of the Public Webinar but no later than the date provided in
Technologies Office. As necessary, DOE will designate a DOE official to the DATES section at the beginning of
requests to give an oral presentation preside at the webinar/public meeting this proposed rule. Interested parties
should ask for such alternative and may also use a professional may submit comments, data, and other
arrangements. facilitator to aid discussion. The information using any of the methods
DOE will designate a DOE official to meeting will not be a judicial or described in the ADDRESSES section at
preside at the webinar/public meeting evidentiary-type public hearing, but the beginning of this document.
and may also use a professional DOE will conduct it in accordance with Submitting comments via
facilitator to aid discussion. The section 336 of EPCA (42 U.S.C. 6306). A www.regulations.gov. The
meeting will not be a judicial or court reporter will be present to record www.regulations.gov web page will
evidentiary-type public hearing, but the proceedings and prepare a require you to provide your name and
DOE will conduct it in accordance with transcript. DOE reserves the right to contact information. Your contact
section 336 of EPCA (42 U.S.C. 6306). A schedule the order of presentations and information will be viewable to DOE
court reporter will be present to record to establish the procedures governing Building Technologies staff only. Your
the proceedings and prepare a the conduct of the webinar. There shall contact information will not be publicly
transcript. DOE reserves the right to not be discussion of proprietary viewable except for your first and last
schedule the order of presentations and information, costs or prices, market names, organization name (if any), and
to establish the procedures governing share, or other commercial matters submitter representative name (if any).
the conduct of the webinar. There shall regulated by U.S. anti-trust laws. After If your comment is not processed
not be discussion of proprietary the webinar and until the end of the properly because of technical
information, costs or prices, market comment period, interested parties may difficulties, DOE will use this
share, or other commercial matters submit further comments on the information to contact you. If DOE
regulated by U.S. anti-trust laws. After proceedings and any aspect of the cannot read your comment due to
the webinar and until the end of the rulemaking. technical difficulties and cannot contact
comment period, interested parties may The webinar will be conducted in an you for clarification, DOE may not be
submit further comments on the informal, conference style. DOE will a able to consider your comment.
proceedings and any aspect of the general overview of the topics addressed However, your contact information
rulemaking. in this rulemaking, allow time for will be publicly viewable if you include
The webinar will be conducted in an prepared general statements by it in the comment itself or in any
informal, conference style. DOE will a participants, and encourage all documents attached to your comment.
general overview of the topics addressed interested parties to share their views on Any information that you do not want
in this rulemaking, allow time for issues affecting this rulemaking. Each to be publicly viewable should not be
prepared general statements by participant will be allowed to make a included in your comment, nor in any
participants, and encourage all general statement (within time limits document attached to your comment.
interested parties to share their views on determined by DOE), before the Otherwise, persons viewing comments
issues affecting this rulemaking. Each discussion of specific topics. DOE will will see only first and last names,
organization names, correspondence reduces comment processing and are serving distribution applications,
containing comments, and any posting time. and if so, the number of distribution
documents submitted with the Confidential Business Information. transformers impacted by the proposed
comments. Pursuant to 10 CFR 1004.11, any person amendment.
Do not submit to www.regulations.gov submitting information that he or she (8) DOE requests comment and data as
information for which disclosure is believes to be confidential and exempt to whether 5,000 kVA represents the
restricted by statute, such as trade by law from public disclosure should upper end of what is considered
secrets and commercial or financial submit via email two well-marked distribution transformers or if another
information (hereinafter referred to as copies: one copy of the document value should be used.
Confidential Business Information marked ‘‘confidential’’ including all the (9) DOE requests comment and data as
(‘‘CBI’’)). Comments submitted through information believed to be confidential, to the number of shipments of three-
www.regulations.gov cannot be claimed and one copy of the document marked phase, liquid-immersed, distribution
as CBI. Comments received through the ‘‘non-confidential’’ with the information transformers greater than 2,500 kVA that
website will waive any CBI claims for believed to be confidential deleted. DOE would meet the in-scope voltage
the information submitted. For will make its own determination about limitations and the distribution of
information on submitting CBI, see the the confidential status of the efficiencies of those units.
Confidential Business Information information and treat it according to its (10) DOE requests comment and data
section. determination. as to the number of shipments of three-
DOE processes submissions made It is DOE’s policy that all comments phase, dry-type, distribution
through www.regulations.gov before may be included in the public docket, transformers greater than 2,500 kVA that
posting. Normally, comments will be without change and as received, would meet the in-scope voltage
posted within a few days of being including any personal information limitations and the distribution of
submitted. However, if large volumes of provided in the comments (except efficiencies of those units.
comments are being processed information deemed to be exempt from (11) DOE requests comment on its
simultaneously, your comment may not public disclosure). understanding and proposed definition
be viewable for up to several weeks. of ‘‘submersible’’ distribution
E. Issues on Which DOE Seeks Comment transformer. Specifically, DOE requests
Please keep the comment tracking
number that www.regulations.gov Although DOE welcomes comments information on specific design
provides after you have successfully on any aspect of this proposal, DOE is characteristics of distribution
uploaded your comment. particularly interested in receiving transformers that allow them to operate
Submitting comments via email. comments and views of interested while submerged in water, as well as
Comments and documents submitted parties concerning the following issues: data on the impact to efficiency
(1) DOE requests comment on the resulting from such characteristics.
via email also will be posted to
proposed amendment to the definition (12) DOE requests comment and data
www.regulations.gov. If you do not want
of drive (isolation) transformer. DOE as to the impact that submersible
your personal contact information to be
requests comment on its tentative characteristics have on distribution
publicly viewable, do not include it in
determination that voltage ratings of transformer efficiency.
your comment or any accompanying (13) DOE requests data on the
208Y/120 and 480Y/277 indicate a
documents. Instead, provide your difference in load loss by kVA for
design for use in general purpose
contact information in a cover letter. distribution transformers with multiple-
applications. DOE also requests
Include your first and last names, email voltage ratings and a voltage ratio other
comment on other voltage ratings or
address, telephone number, and than 2:1.
other characteristics that would indicate
optional mailing address. The cover (14) DOE request data on the number
a design for use in general purpose
letter will not be publicly viewable as of shipments for each equipment class
applications.
long as it does not include any (2) DOE requests comment on its of distribution transformers with multi-
comments. proposed amendment to the definition voltage ratios other than 2:1.
Include contact information each time of ‘‘special-impedance transformer’’ and (15) DOE requests data on the
you submit comments, data, documents, whether it provides sufficient clarity as difference in load loss by kVA for
and other information to DOE. No to how to treat the normal impedance distribution transformers with higher
telefacsimiles (‘‘faxes’’) will be ranges for non-standard kVA currents and at what current it becomes
accepted. distribution transformers. more difficult to meet energy
Comments, data, and other (3) DOE requests comment on its conservation standards.
information submitted to DOE proposed definition for transformers (16) DOE requests data as to the
electronically should be provided in with a tap range of 20 percent or more. number of shipments of distribution
PDF (preferred), Microsoft Word or (4) DOE requests comment on its transformers with the higher currents
Excel, WordPerfect, or text (ASCII) file proposed amendments to the definitions that would have a more difficult time
format. Provide documents that are not of sealed and nonventilated meeting energy conservation standards.
secured, that are written in English, and transformers. (17) DOE requests comment as to
that are free of any defects or viruses. (5) DOE requests comment on its what modifications could be made to
Documents should not contain special proposed amendment to the definition the April 2013 Standard Final Rule data
characters or any form of encryption of uninterruptable power supply center definition such that the
and, if possible, they should carry the
transformers. identifying features are related to

electronic signature of the author. (6) DOE requests comment as to efficiency and would prevent a data
Campaign form letters. Please submit whether its proposed definition better center transformer from being used in a
campaign form letters by the originating aligns with industries understanding on general purpose application.
organization in batches of between 50 to input and output voltages (18) DOE requests comment regarding
500 form letters per PDF or as one form (7) Further, DOE requests comment its proposal not to establish a separate
letter with a list of supporters’ names and data on whether the proposed equipment class for data center
compiled into one or more PDFs. This amendment would impact products that distribution transformers. In particular,
DOE seeks comment regarding whether amended efficiency standards, as the rate of any extensive load growth
data center distribution transformers are discussed in section IV.A.2 of this that may be occurring in response to
able to reach the same efficiency levels document, but ultimately has these programs.
as distribution transformers generally determined not to include such separate (34) DOE requests comments on its
and the specific reasons why that may equipment classes in the proposed methodology for establishing the energy
be the case. standards. However, DOE requests data efficiency levels for distribution
(19) DOE requests comment regarding as to the degree of reduction in transformers greater than 2500 kVA.
any challenges that would exist if efficiency associated with various DOE request comment on its assumed
designing a distribution transformer features. energy efficiency ratings.
which uses amorphous electrical steel (26) DOE requests data as to how stray (35) DOE requests comment on its
in its core for data center applications and eddy losses at rated PUL vary with assumed TOC adoption rate of 10
and whether data center transformers kVA and rated voltages. percent. Specifically, DOE requests
have been built which use amorphous (27) DOE requests comment on the comment on the TOC rate suggested by
electrical steel in their cores. current and future market pressures NEMA, that between 15 and 20 percent
(20) DOE requests comment on the influencing the price of GOES. of 3-phase liquid-immersed distribution
interaction of inrush current and data Specifically, DOE is interested in the transformers are purchased using TOC,
center distribution transformer design. barriers to and costs associated with and that 40 percent of 1-phase liquid-
Specifically, DOE seeks information converting a factory production line immersed distribution transformers are
regarding: (1) the range of inrush current from GOES to NOES. purchased using TOC. DOE notes, that
limit values in use in data center (28) DOE further requests comment it is seeking data related to concluded
distribution transformers; (2) any regarding how the prices of both GOES sales based on lowest TOC in the
challenges in meeting such inrush and amorphous are expected to change strictest sense, excluding those
current limit values when using in the immediate and distant future. transformers sold using band of
amorphous electrical steel in the core; (29) DOE requests comment regarding equivalents (see the section on band of
(3) whether using amorphous electrical the barriers to converting current M3 or equivalents, above)
steel inherently increases inrush 23hib90 electrical steel production to (36) DOE requests comment on the
current, and why; (4) how the lower-loss GOES core steels. fraction of distribution transformers
(magnetic) remanence of grain-oriented (30) DOE requests comment as to if purchased by customers using the BOE
electrical steel compares to that of there are markets for amorphous ribbon, methodology. DOE notes, that it is
amorphous steel; and (5) other strategies similar to NOES competition from seeking data related to concluded sales
or technologies than distribution GOES production, which would put based on lowest BOE in the strictest
transformer design which could be used competitive pressures on the production sense, excluding those transformers sold
to limit inrush current and the of amorphous ribbon for distribution using total owning costs.
respective costs of those measures. transformers. (37) DOE request comment if the rates
(21) DOE requests data as to how a (31) DOE requests comment on how a of TOC or BOE vary by transformer
liquid-immersed distribution potentially limited supply of capacity or number of phases. Further,
transformer losses vary with BIL across transformer core steel, both of DOE seeks the fraction of distribution
the range of kVA values within scope. amorphous and GOES, may affect core transformer sales using either method
(22) DOE requests comments and data steel price and availability. DOE seeks into the different regions in order to
on any other types of equipment that comment on any factors which uniquely capture the believed relationship
may have a harder time meeting energy affect specific steel grades (e.g., between higher electricity costs and
conservation standards. Specifically, amorphous, M-grades, hib, dr, pdr). purchase evaluation behavior.
DOE requests comments as to how these Additionally, DOE seeks comment on (38) Transformers are typically
other equipment are identified based on how it should model a potentially installed using a bucket truck, or crane
physical features from general purpose concentrated domestic steel market in truck. DOE requests comment on the
distribution transformers, the number of its analysis, resulting from a limited typical maximum lifting capacity, and
shipments of each unit, and the number of suppliers for the amorphous the typical transformer capacity being
possibility of these equipment being market or from competition with NOES installed.
used in place of generally purpose for the GOES market, including any use (39) For this NOPR, DOE reiterates its
distribution transformers. of game theoretic modeling as request for the following information.
(23) DOE requests data demonstrating appropriate. DOE requests data and feedback on the
any specific distribution transformer (32) DOE requests comment or data size limitations of pad-mounted
designs that would have significantly showing hourly transformer loads for distribution transformers. Specifically,
different cost-efficiency curves than industrial customers. what sizes, voltages, or other features
those representative units modeled by (33) To help inform DOE’s prediction are currently unable to fit on current
DOE. of future load growth trend, DOE seeks pads, and the dimension of these pads.
(24) DOE requests comment on its data on the following for regions where DOE seeks data on the typical concrete
methodology for scaling RU5, RU12, decarbonization efforts are ongoing. pad dimensions for 50 and 500 kVA
and RU14 to represent the efficiency of DOE seeks hourly PUL data at the level single-; and 500, and 1500 kVA three-
units above 3,750 kVA. of the transformer bank for each of the phase distribution transformers. DOE
(25) DOE requests comment on its past five years to establish an seeks data on the typical service
methodology for modifying the results unambiguous relationship between
lifetimes of supporting concrete pads.

of RU4 and RU5 to represent the transformer loads and decarbonization (40) DOE request the average
efficiency of submersible liquid- policy and inform if any intensive load extension of distribution transformer
immersed units. For other potentially growth is indeed occurring. service life that can be achieved through
disadvantaged designs, DOE has Additionally, DOE seeks the average rebuilding. Additionally, DOE requests
considered establishing equipment capacity of shipment into regions where comment on the fraction of transformer
classes to separate out those that would decarbonization efforts are occurring that are repaired by their original
have the most difficulty achieving over the same five-year period to inform purchasing entity and returned to
service, thereby extending the (48) DOE requests comment on the the Department of Energy. This
transformer’s service lifetime beyond estimated potential domestic administrative process in no way alters
the estimated lifetimes of 32 years with employment impacts on distribution the legal effect of this document upon
a maximum of 60 years. transformer manufacturers presented in publication in the Federal Register.
(41) DOE requests comment on which this NOPR. Signed in Washington, DC, on December
liquid-immersed distribution (49) DOE requests comment on the 29, 2022.
transformers capacities are typically potential availability of either Treena V. Garrett,
replaced with MVDT. DOE further amorphous steel, grain-oriented
Federal Register Liaison Officer, U.S.
requests data that would indicate a electrical steel, or any other materials Department of Energy
trend in these substitutions. DOE further that may be needed to meet any of the
requests data that would help it analyzed energy conservation standards For the reasons set forth in the
determine which types of customers are in this rulemaking. More specifically, preamble, DOE proposes to amend part
preforming these substitutions, e.g., DOE requests comment on steel 431 of chapter II, of title 10 of the Code
industrial customers, invertor owned manufacturers’ ability to increase of Federal Regulations, as set forth
utilities, MUNIs, etc. supply of amorphous steel in reaction to below:
(42) In response to NEMA’s comment increased demand for amorphous steel
DOE requests data to inform a shift in as a result of increased energy PART 431—ENERGY EFFICIENCY
the capacity distribution to larger conservation standards for distribution PROGRAM FOR CERTAIN
capacity distribution transformers. transformers. COMMERCIAL AND INDUSTRIAL
Additionally, DOE requests information (50) DOE requests comment on the EQUIPMENT
on the extent that this increasing trend number of small businesses identified
in capacity would affect all types of ■ 1. The authority citation for part 431
that manufacture distribution continues to read as follows:
distribution transformers, or only transformers covered by this rulemaking
medium-voltage distribution (three small liquid-immersed and seven Authority: 42 U.S.C. 6291–6317; 28 U.S.C.
transformers. LVDT small businesses; three of which 2461 note.
(43) DOE projected the energy also manufacture MVDT). Additionally, ■ 2. Section 431.192 is amended by:
savings, operating cost savings, product DOE requests comment on its initial ■ a. Revising the definitions of
costs, and NPV of consumer benefits assumption that only one LVDT small ‘‘Distribution transformer’’, ‘‘Drive
over the lifetime of distribution business and no liquid-immersed small (isolation) transformer’’, ‘‘Nonventilated
transformers sold from 2027 through businesses manufacturer their own transformer’’, ‘‘Sealed transformer’’,
2056. Given the extremely durable cores used in their distribution ‘‘Special-impedance transformer’’,
nature of distribution transformers, this transformers. ‘‘Transformer with a tap range of 20
creates an analytical timeframe from (51) Additionally, DOE welcomes percent or more’’, ‘‘Uninterruptible
2027 through 2115. DOE seeks comment comments on other issues relevant to power supply transformer’’; and
on the current analytical timeline, and the conduct of this rulemaking that may ■ b. Adding in alphabetical order,
potential alternative analytical not specifically be identified in this definition for ‘‘Submersible distribution
timeframes. document. transformer’’
(44) DOE requests comment on its The revisions and addition read as
assumption that including a rebound VIII. Approval of the Office of the
follows:
effect is inappropriate for distribution Secretary
transformers. The Secretary of Energy has approved § 431.19 Definitions.
(45) DOE requests comment on the publication of this notice of proposed * * * * *
mean PUL applied to distribution rulemaking and announcement of Distribution transformer means a
transformers owned and operated by public meeting. transformer that:
utilities serving low customer (1) Has an input line voltage of 34.5
populations. List of Subjects in 10 CFR Part 431 kV or less;
(46) DOE requests comment on its Administrative practice and (2) Has an output line voltage of 600
assumed vault replacement costs procedure, Confidential business V or less;
methodology. DOE seeks comment or information, Energy conservation test (3) Is rated for operation at a
data regarding the installation procedures, and Reporting and frequency of 60 Hz; and
procedures associated with vault recordkeeping requirements. (4) Has a capacity of 10 kVA to 5000
replacement, vault expansion kVA for liquid-immersed units and 15
(renovation), and vault transformer Signing Authority
kVA to 5000 kVA for dry-type units; but
installation and their respective costs This document of the Department of (5) The term ‘‘distribution
for replacement transformers. Energy was signed on December 28, transformer’’ does not include a
Additionally, DOE seeks information on 2022, by Francisco Alejandro Moreno, transformer that is an –
the typical expected lifetime of Acting Assistant Secretary for Energy (i) Autotransfromer;
underground concrete vaults. Efficiency and Renewable Energy, (ii) Drive (isolation) transformer;
(47) DOE requests comment on the pursuant to delegated authority from the (iii) Grounding transformer;
real discount rates used in this NOPR. Secretary of Energy. That document (iv) Machine-tool (control
Specifically, if 7.4 percent for liquid- with the original signature and date is transformer);
immersed distribution transformer maintained by DOE. For administrative
(v) Nonventilated transformer;

manufacturers, 11.1 percent for low- purposes only, and in compliance with (vi) Rectified transformer;
voltage dry-type distribution requirements of the Office of the Federal (vii) Regulating transformer;
transformer manufacturers, and 9.0 Register, the undersigned DOE Federal (viii) Sealed transformer;
percent for medium-voltage dry-type Register Liaison Officer has been (ix) Special-impedance transformer;
distribution transformer manufacturers authorized to sign and submit the (x) Testing transformer;
are appropriate discount rates to use in document in electronic format for (xi) Transformer with tap range of 20
the GRIM. publication, as an official document of percent or more;
(xii) Uninterruptible power supply (4) Has a rated output voltage that is an impedance outside of the normal
transformer; or neither ‘‘208Y/120’’ nor ‘‘480Y/277’’. impedance range for that transformer’s
(xiii) Welding transformer. * * * * * kVA rating. The normal impedance
Drive (isolation) transformer means a Nonventilated transformer means a range for each kVA rating for liquid-
transformer that: dry-type transformer constructed so as immersed and dry-type transformers is
to prevent external air circulation show in Tables 1 and 2, respectively.
(1) Isolates an electric motor from the through the coils of the transformer Distribution transformers with kVA
line; while operating at zero gauge pressure. ratings not appearing in the tables shall
(2) Accommodates the added loads of * * * * * have their minimum normal impedance
drive-created harmonics; Sealed transformer means a dry-type and maximum normal impedance
(3) Is designed to withstand the transformer designed to remain determined by linear interpolation of
additional mechanical stressed resulting hermetically sealed under specified the kVA and minimum and maximum
from an alternating current adjustable condition of temperature and pressure. impedances, respectively, of the values
frequency motor drive or a direct Special-impedance transformer immediately above and below that kVA
current motor drive; and means a transformer built to operate at rating.
TABLE 1—NORMAL IMPEDANCE RANGES FOR LIQUID-IMMERSED TRANSFORMERS

Impedance Impedance
kVA kVA
(%) (%)
10 .................................................................................. 1.0–4.5 15 ................................................................................. 1.0–4.5

15 .................................................................................. 1.0–4.5 30 ................................................................................. 1.0–4.5
25 .................................................................................. 1.0–4.5 45 ................................................................................. 1.0–4.5
37.5 ............................................................................... 1.0–4.5 75 ................................................................................. 1.0–5.0
50 .................................................................................. 1.5–4.5 112.5 ............................................................................ 1.2–6.0
75 .................................................................................. 1.5–4.5 150 ............................................................................... 1.2–6.0
100 ................................................................................ 1.5–4.5 225 ............................................................................... 1.2–6.0
167 ................................................................................ 1.5–4.5 300 ............................................................................... 1.2–6.0
250 ................................................................................ 1.5–6.0 500 ............................................................................... 1.5–7.0
333 ................................................................................ 1.5–6.0 750 ............................................................................... 5.0–7.5
500 ................................................................................ 1.5–7.0 1,000 ............................................................................ 5.0–7.5
667 ................................................................................ 5.0–7.5 1,500 ............................................................................ 5.0–7.5
833 ................................................................................ 5.0–7.5 2,000 ............................................................................ 5.0–7.5
2,500 ............................................................................ 5.0–7.5
3,750 ............................................................................ 5.0–7.5
5,000 ............................................................................ 5.0–7.5
TABLE 2—NORMAL IMPEDANCE RANGES FOR DRY-TYPE TRANSFORMERS

Impedance Impedance
kVA kVA
(%) (%)
15 .................................................................................. 1.5–6.0 15 ................................................................................. 1.5–6.0

25 .................................................................................. 1.5–6.0 30 ................................................................................. 1.5–6.0
37.5 ............................................................................... 1.5–6.0 45 ................................................................................. 1.5–6.0
50 .................................................................................. 1.5–6.0 75 ................................................................................. 1.5–6.0
75 .................................................................................. 2.0–7.0 112.5 ............................................................................ 1.5–6.0
100 ................................................................................ 2.0–7.0 150 ............................................................................... 1.5–6.0
167 ................................................................................ 2.5–8.0 225 ............................................................................... 3.0–7.0
250 ................................................................................ 3.5–8.0 300 ............................................................................... 3.0–7.0
333 ................................................................................ 3.5–8.0 500 ............................................................................... 4.5–8.0
500 ................................................................................ 3.5–8.0 750 ............................................................................... 5.0–8.0
667 ................................................................................ 5.0–8.0 1,000 ............................................................................ 5.0–8.0
833 ................................................................................ 5.0–8.0 1,500 ............................................................................ 5.0–8.0
2,000 ............................................................................ 5.0–8.0
2,500 ............................................................................ 5.0–8.0
3,750 ............................................................................ 5.0–8.0
5,000 ............................................................................ 5.0–8.0
Submersible Distribution Transformer (1) Is rated for a temperature rise of (4) Has the tank, cover, and all
means a liquid-immersed distribution 55°C; external appurtenances made of
transformer so constructed as to be (2) Has insulation rated for a corrosion-resistant material.
successfully operable when submerged temperature rise of 65°C; * * * * *
in water including the following Transformer with tap range of 20
(3) Has sealed-tank construction; and
features: percent or more means a transformer
with multiple full-power voltage taps,
the highest of which equals at least 20 output, or by-pass of an uninterruptible (2) The efficiency of a low-voltage,
percent more than the lowest, computed power system. dry-type distribution transformer
based on the sum of the deviations of * * * * * manufactured on or after January 1,
these taps from the transformer’s ■ 3. Amend § 431.196 by: 2016, but before January 1, 2027, shall
maximum full-power voltage. ■ a. Revising paragraph (a)(2) and be no less than that required for the
adding paragraph (a)(3), applicable kVA rating in the table
Uninterruptible power supply ■ b. Revising paragraph (b)(2) and
transformer means a transformer that is below. Low-voltage dry-type
adding paragraphs (b)(3) through (4), distribution transformers with kVA
used within an uninterruptible power and
system, which in turn supplies power to ratings not appearing in the table shall
■ c. Revising paragraph (c)(2) and
loads that are sensitive to power failure, adding paragraph (c)(3). have their minimum efficiency level
power sages, over voltage, switching The revisions and additions read as determined by linear interpolation of
transients, line notice, and other power follows: the kVA and efficiency values
quality factors. It does not include immediately above and below that kVA
§ 431.196 Energy conservation standards rating.
distribution transformers at the input, and their effective dates.
(a) * * *
kVA kVA
15 .................................................................................. 97.70 15 ................................................................................. 97.89

25 .................................................................................. 98.00 30 ................................................................................. 98.23
37.5 ............................................................................... 98.20 45 ................................................................................. 98.40
50 .................................................................................. 98.30 75 ................................................................................. 98.60
75 .................................................................................. 98.50 112.5 ............................................................................ 98.74
100 ................................................................................ 98.60 150 ............................................................................... 98.83
167 ................................................................................ 98.70 225 ............................................................................... 98.94
250 ................................................................................ 98.80 300 ............................................................................... 99.02
333 ................................................................................ 98.90 500 ............................................................................... 99.14
750 ............................................................................... 99.23
1000 ............................................................................. 99.28
Note: All efficiency values are at 35 percent of nameplate-rated load, determined according to the DOE Test Method for Measuring the Energy
Consumption of Distribution Transformers under appendix A to subpart K of 10 CFR part 431.
(3) The efficiency of a low-voltage for their kVA rating in the table below. minimum efficiency level determined
dry-type distribution transformer Low-voltage dry-type distribution by linear interpolation of the kVA and
manufactured on or after January 1, transformers with kVA ratings not efficiency values immediately above
2027, shall be no less than that required appearing in the table shall have their and below that kVA rating.
kVA kVA
(%) (%)
15 .................................................................................. 98.84 15 ................................................................................. 98.72

25 .................................................................................. 98.99 30 ................................................................................. 98.93
37.5 ............................................................................... 99.09 45 ................................................................................. 99.03
50 .................................................................................. 99.14 75 ................................................................................. 99.16
75 .................................................................................. 99.24 112.5 ............................................................................ 99.24
100 ................................................................................ 99.30 150 ............................................................................... 99.29
167 ................................................................................ 99.35 225 ............................................................................... 99.36
250 ................................................................................ 99.40 300 ............................................................................... 99.41
333 ................................................................................ 99.45 500 ............................................................................... 99.48
750 ............................................................................... 99.54
1000 ............................................................................. 99.57
(b) * * * 2027, shall be no less than that required have their minimum efficiency level
(2) The efficiency of a liquid- for their kVA rating in the table below. determined by linear interpolation of
immersed distribution transformer, Liquid-immersed distribution the kVA and efficiency values
including submersible distribution transformers, including submersible immediately above and below that kVA
transformers, manufactured on or after distribution transformers, with kVA rating.
January 1, 2016, but before January 1, ratings not appearing in the table shall
kVA Efficiency (%) kVA Efficiency (%)
10 .................................................................................. 98.70 15 ................................................................................. 98.65

15 .................................................................................. 98.82 30 ................................................................................. 98.83
25 .................................................................................. 98.95 45 ................................................................................. 98.92
37.5 ............................................................................... 99.05 75 ................................................................................. 99.03
50 .................................................................................. 99.11 112.5 ............................................................................ 99.11
75 .................................................................................. 99.19 150 ............................................................................... 99.16
100 ................................................................................ 99.25 225 ............................................................................... 99.23
167 ................................................................................ 99.33 300 ............................................................................... 99.27
250 ................................................................................ 99.39 500 ............................................................................... 99.35
333 ................................................................................ 99.43 750 ............................................................................... 99.40
500 ................................................................................ 99.49 1,000 ............................................................................ 99.43
667 ................................................................................ 99.52 1,500 ............................................................................ 99.48
833 ................................................................................ 99.55 2,000 ............................................................................ 99.51
2,500 ............................................................................ 99.53
Note: All efficiency values are at 50 percent of nameplate-rated load, determined according to the DOE Test-Procedure, appendix A to subpart
K of 10 CFR part 431.
(3) The efficiency of a liquid- that required for their kVA rating in the determined by linear interpolation of
immersed distribution transformer, that table below. Liquid-immersed the kVA and efficiency values
is not a submersible distribution distribution transformers with kVA immediately above and below that kVA
transformer, manufactured on or after ratings not appearing in the table shall rating.
January 1, 2027, shall be no less than have their minimum efficiency level
kVA kVA
(%) (%)
10 .................................................................................. 98.96 15 ................................................................................. 98.92

15 .................................................................................. 99.05 30 ................................................................................. 99.06
25 .................................................................................. 99.16 45 ................................................................................. 99.13
37.5 ............................................................................... 99.24 75 ................................................................................. 99.22
50 .................................................................................. 99.29 112.5 ............................................................................ 99.29
75 .................................................................................. 99.35 150 ............................................................................... 99.33
100 ................................................................................ 99.40 225 ............................................................................... 99.38
167 ................................................................................ 99.46 300 ............................................................................... 99.42
250 ................................................................................ 99.51 500 ............................................................................... 99.48
333 ................................................................................ 99.54 750 ............................................................................... 99.52
500 ................................................................................ 99.59 1,000 ............................................................................ 99.54
667 ................................................................................ 99.62 1,500 ............................................................................ 99.58
833 ................................................................................ 99.64 2,000 ............................................................................ 99.61
2,500 ............................................................................ 99.62
3,750 ............................................................................ 99.66
5,000 ............................................................................ 99.68
(4) The efficiency of a submersible rating in the table below. Submersible determined by linear interpolation of
distribution transformer, manufactured distribution transformers with kVA the kVA and efficiency values
on or after January 1, 2027, shall be no ratings not appearing in the table shall immediately above and below that kVA
less than that required for their kVA have their minimum efficiency level rating.
kVA kVA
(%) (%)
10 .................................................................................. 98.70 15 ................................................................................. 98.65

15 .................................................................................. 98.82 30 ................................................................................. 98.83
25 .................................................................................. 98.95 45 ................................................................................. 98.92
37.5 ............................................................................... 99.05 75 ................................................................................. 99.03

50 .................................................................................. 99.11 112.5 ............................................................................ 99.11
75 .................................................................................. 99.19 150 ............................................................................... 99.16
100 ................................................................................ 99.25 225 ............................................................................... 99.23
167 ................................................................................ 99.33 300 ............................................................................... 99.27
250 ................................................................................ 99.39 500 ............................................................................... 99.35
333 ................................................................................ 99.43 750 ............................................................................... 99.40
500 ................................................................................ 99.49 1,000 ............................................................................ 99.43
kVA kVA
(%) (%)
667 ................................................................................ 99.52 1,500 ............................................................................ 99.48

833 ................................................................................ 99.55 2,000 ............................................................................ 99.51
2,500 ............................................................................ 99.53
Note: All efficiency values are at 50 percent of nameplate-rated load, determined according to the DOE Test-Procedure appendix A to subpart
K of 10 CFT part 431.
(c) * * * 2027, shall be no less than that required have their minimum efficiency level
(2) The efficiency of a medium- for their kVA and BIL rating in the table determined by linear interpolation of
voltage dry-type distribution below. Medium-voltage dry-type the kVA and efficiency values
transformer manufactured on or after distribution transformers with kVA immediately above and below that kVA
January 1, 2016, but before January 1, ratings not appearing in the table shall rating.
BIL BIL
20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

kVA kVA
(%) (%) (%) (%) (%) (%)
15 .......................... 98.10 97.86 ........................ 15 .......................... 97.50 97.18 ........................

25 .......................... 98.33 98.12 ........................ 30 .......................... 97.90 97.63 ........................
37.5 ....................... 98.49 98.30 ........................ 45 .......................... 98.10 97.86 ........................
50 .......................... 98.60 98.42 ........................ 75 .......................... 98.33 98.13 ........................
75 .......................... 98.73 98.57 98.53 112.5 ..................... 98.52 98.36 ........................
100 ........................ 98.82 98.67 98.63 150 ........................ 98.65 98.51 ........................
167 ........................ 98.96 98.83 98.80 225 ........................ 98.82 98.69 98.57
250 ........................ 99.07 98.95 98.91 300 ........................ 98.93 98.81 98.69
333 ........................ 99.14 99.03 98.99 500 ........................ 99.09 98.99 98.89
500 ........................ 99.22 99.12 99.09 750 ........................ 99.21 99.12 99.02
667 ........................ 99.27 99.18 99.15 1,000 ..................... 99.28 99.20 99.11
833 ........................ 99.31 99.23 99.20 1,500 ..................... 99.37 99.30 99.21
2,000 ..................... 99.43 99.36 99.28
2,500 ..................... 99.47 99.41 99.33
* BIL means basic impulse insulation level
Note: All efficiency values are at 50 percent of nameplate rated load, determined according to the DOE Test Method for Measuring the Energy
(3) The efficiency of a medium- rating in the table below. Medium- by linear interpolation of the kVA and
voltage dry-type distribution voltage dry-type distribution efficiency values immediately above
transformer manufactured on or after transformers with kVA ratings not and below that kVA rating.
January 1, 2027, shall be no less than appearing in the table shall have their
that required for their kVA and BIL minimum efficiency level determined
BIL BIL
20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

kVA kVA
(%) (%) (%) (%) (%) (%)
15 .......................... 98.29 98.07 ........................ 15 .......................... 97.74 97.45 ........................

25 .......................... 98.49 98.30 ........................ 30 .......................... 98.11 97.86 ........................
37.5 ....................... 98.64 98.47 ........................ 45 .......................... 98.29 98.07 ........................
50 .......................... 98.74 98.58 ........................ 75 .......................... 98.49 98.31 ........................
75 .......................... 98.86 98.71 98.68 112.5 ..................... 98.67 98.52 ........................
100 ........................ 98.94 98.80 98.77 150 ........................ 98.78 98.66 ........................
167 ........................ 99.06 98.95 98.92 225 ........................ 98.94 98.82 98.71
250 ........................ 99.16 99.05 99.02 300 ........................ 99.04 98.93 98.82
333 ........................ 99.23 99.13 99.09 500 ........................ 99.18 99.09 99.00
500 ........................ 99.30 99.21 99.18 750 ........................ 99.29 99.21 99.12
667 ........................ 99.34 99.26 99.23 1,000 ..................... 99.35 99.28 99.20
833 ........................ 99.38 99.31 99.28 1,500 ..................... 99.43 99.37 99.29
2,000 ..................... 99.49 99.42 99.35
2,500 ..................... 99.52 99.47 99.40
BIL BIL
20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

kVA kVA
(%) (%) (%) (%) (%) (%)
3,750 ..................... 99.58 99.53 99.47

5,000 ..................... 99.62 99.58 99.51
* BIL means basic impulse insulation level
Note: All efficiency values are at 50 percent of nameplate rated load, determined according to the DOE Test Method for Measuring the Energy
* * * * *
[FR Doc. 2022–28590 Filed 1–10–23; 8:45 am]
BILLING CODE 6450–01–P

0018-0065 Content

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

0018-0065 Content

Uploaded by

Copyright:

Available Formats

1722 Federal Register / Vol. 88, No.

7 / Wednesday, January 11, 2023 / Proposed Rules

15 ........................................................................... 98.84 15 ........................................................................... 98.72

TABLE I.2—PROPOSED ENERGY CONSERVATION STANDARDS FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS

10 ........................................................................... 98.96 15 ........................................................................... 98.92

5,000 ...................................................................... 99.68

TABLE I.3—PROPOSED ENERGY CONSERVATION STANDARDS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION

20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

15 ...................................... 98.29 98.07 .................... 15 ..................................... 97.74 97.45 ....................

10 ..................................................................................................................................... 14 ¥2,856 26.1

presented in section V.B.8 of this

Consumer Operating Cost Savings ..................................................................................................................................................... 12.77

Consumer Operating Cost Savings ..................................................................................................................................................... 4.28

Consumer Operating Cost Savings ............................................................................. 733.5 686.9 789.9

Consumer Operating Cost Savings ............................................................................. 451.9 425.7 482.2

14 The quantity refers to full-fuel-cycle (‘‘FFC’’)

Consumer Operating Cost Savings ..................................................................................................................................................... 13.45

Consumer Operating Cost Savings ..................................................................................................................................................... 4.69

Consumer Operating Cost Savings ............................................................................. 772.1 716.9 831.3

Consumer Operating Cost Savings ............................................................................. 495.0 462.8 528.7

Distribution Transformers distribution transformers would save a voltage dry-type distribution

Consumer Operating Cost Savings ..................................................................................................................................................... 0.41

Consumer Operating Cost Savings ..................................................................................................................................................... 0.14

NOX emissions reductions associated with

Consumer Operating Cost Savings ............................................................................. 23.3 22.2 25.8

Consumer Operating Cost Savings ............................................................................. 14.9 14.3 16.4

Consumer Operating Cost Savings ............................................................................. 1,528.9 1,426.0 1,647.0

Consumer Operating Cost Savings ............................................................................. 961.8 902.8 1,027.3

Consumer Operating Cost Savings ..................................................................................................................................................... 26.63

Consumer Operating Cost Savings ..................................................................................................................................................... 9.11

performance characteristics (including

15 .................................................................................. 97.70 15 ................................................................................. 97.89

TABLE II.2—FEDERAL ENERGY CONSERVATION STANDARDS FOR LIQUID-IMMERSED DISTRIBUTION TRANSFORMERS

10 .................................................................................. 98.70 15 ................................................................................. 98.65

TABLE II.3—FEDERAL ENERGY CONSERVATION STANDARDS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION

20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

(%) (%) (%) (%) (%) (%)

15 .......................... 98.1 97.86 ........................ 15 .......................... 97.5 97.18 ........................

TABLE II.3—FEDERAL ENERGY CONSERVATION STANDARDS FOR MEDIUM-VOLTAGE DRY-TYPE DISTRIBUTION

20–45 kV 46–95 kV ≥96 kV 20–45 kV 46–95 kV ≥96 kV

TABLE II.4—AUGUST 2021 PRELIMINARY ANALYSIS WRITTEN COMMENTS

statement of policy and notice of policy

c. Energy Savings amended standard is economically period contemplated under the

ADDRESSES section for information to

isolation transformers’’ are likely to be manufacturers are currently interpreting

wye-connected distribution distribution transformer input voltage

i. kVA Range three-phase liquid-immersed purpose distribution transformers sold

efficiency/energy-efficiency-regulations/guide- 2014, Available online at: https://eur-lex.europa.eu/ EERE–2006–STD–0099–0105. Available at

TABLE IV.1—CURRENT EQUIPMENT CLASSES FOR DISTRIBUTION TRANSFORMERS

EC11 ............. Mining Transformers

are slightly less efficient. (Eaton, No. 55

PUL as compared to rated temperature submersible distribution transformer

lower flux density. In response, Metglas commented that

TABLE IV.4—SCREENED-OUT TECHNOLOGIES

that would have significantly different

available on the market). unanalyzed, kVA ratings within that

included estimated load performance in chapter 5 of the TSD. The impact of

and timeliness of purchasing the

savings are cost effective under different

online at: https://www.bpa.gov/EE/NewsEvents/

report-2018.pdf. an item’s monetary value. BIS–2020–0015–0033 at pp. 2–5).

Docket No. BIS–2020–0015–0075 at p. 168. sgp/crs/misc/R45249.pdf. pp. 3–4).

used as compared to GOES because