The Bush administration’s DOE proposal follows a 60-day review of a rule proposed by the outgoing Clinton administration, which set a 13-SEER standard as the minimum.

That 13-SEER standard was strongly opposed by manufacturers represented by the Air-Conditioning and Refrigeration Institute (ARI), which last month filed a petition in federal court saying the findings and conclusions were “arbitrary, capricious, contrary to statute, and otherwise not in accordance with the law.” ARI also petitioned DOE late in March for reconsideration.

A notice of DOE’s newly proposed rules will appear in the Federal Register soon, perhaps this week (April 23-27), DOE spokesperson Jeanne Lopatto told The News. That will be followed by a 60-day or longer period for public comment, according to Ed Dooley, ARI vice president of Communications and Education.

U.S. Secretary of Energy Spencer Abraham said, in announcing the 12-SEER proposal, that the new standard “will provide a 20% increase in energy savings and help to dramatically reduce electricity demand during peak periods.”

He said his department’s main focus during the review was to maximize energy efficiency while minimizing future price increases for consumers, particularly those with low incomes. “We were particularly concerned that the Clinton rule placed too high a cost burden on consumers.”

ARI welcomed the new proposal, asserting in a fact sheet issued last Tuesday that “A SEER 12 standard achieves significant energy-efficiency gains and keeps life-saving cooling equipment within reach of consumers, particularly those who need it most — the elderly and working families on limited incomes.

“If consumers cannot afford equipment at a reasonable cost, there will be no incentive for them to replace their less-efficient unit, and energy use will increase rather than decrease,” the statement added, noting that a 13-SEER rule would cost the manufacturing industry $350 million and eliminate 84% of all new central air conditioning models, 66% of all new heat pump models.

“Some manufacturers could be forced out of business,” ARI said.

‘An Outrage’

Goodman told The News that he didn’t know of any others in the industry siding with him, but said, “Almost everyone [among environmental and consumer groups] believes in what we are saying, other than a few people.”

Goodman Manufacturing is believed to be planning to become a party to the ARI matter pending in federal court, according to a representative from the Alliance to Save Energy.

Dooley said that consumers who want higher-efficiency units can still choose from 13-SEER units made by many manufacturers. “They can buy up to 18 SEER,” he added, but under the proposed minimum of 13 SEER, “consumers would have had many fewer choices.”

David M. Nemtzow, president of the Alliance to Save Energy (ASE), a highly visible consumer-environmental group, called the Bush administration’s decision to reduce air conditioner and heat pump standards from the earlier proposed levels “an outrage. This is bad policy and it’s illegal.”

Bill Prindle, ASE director of Buildings and Utilities, explained the “illegal” reference. The National Appliance Energy Conservation Act (NAECA, 1987) prohibits any new standard that would reduce the energy efficiency of previously published rules, he said.

The Clinton proposals had been first published for comment last October 5, Prindle said, with the public comment period ending December 5. The final rule was then published in the Federal Register in January, before the Clinton administration left office, so he understands it now has the rule of law.

Nemtzow called the action a “cruel blow” to both consumers and the reliability of the U.S. electricity grid. He said the action not only will cost American consumers more than $700 million in annual electricity bills, but will also create more pollution.

Citing current and near-future potential for rolling blackouts in California and the Pacific Northwest, he said Chicago and New York face the same dilemma this summer.

ARI’s Dooley pointed out that the changes in either case would not take effect until 2006, and wouldn’t impact those power situations in the meantime. He said the more modest improvement in efficiency would enable consumers with limited incomes to afford replacement units without incurring higher installation costs.

Improving systems in manufactured housing would have been particularly difficult, Dooley said, noting that 20% to 30% of the nation’s new housing units now are manufactured. “Three-quarters of those units have air conditioning units in the 3-ton-and-up sizes, and to upgrade those [under the 13-SEER standard] would be prohibitive.”

He said there are tens of millions of units in the total housing market that will be replaced under the 12-SEER policy. “We believe strongly this will provide a regulatory scheme that will conserve energy and one that the consumer can live with.”

DOE compared the consumer costs under both the Clinton administration and Bush administration proposals (see Table 1).

“By 2030, the proposed 12/12 SEER standard for residential air conditioners and heat pumps is projected to save 3 quads, the equivalent amount of electricity that could light all U.S. homes for more than two years,” DOE said. “These energy savings are the equivalent of 37 power plants.” The Clinton standards would have saved roughly half as much.

So What’s Next?

Andrew deLaskie, director of the Appliance Standards Awareness Project, a coalition of consumer and environmental groups, questioned the legality of the new administration “attempting to ease a regulation adopted as final in January.” He said DOE’s current stand will be challenged in court.

“I can’t think of a more clear-cut case of where special interest have gotten their way at the expense of the public,” deLaskie told The Associated Press. “After a month of analysis, they’re going to turn back what was developed after six years. That’s reckless.”

ASE’s Nemtzow was just as displeased with the Bush administration.

“The major energy test is what the administration will do on the air conditioner standards, which would have the greatest effect on the nation’s energy use,” Nemtzow said in a prepared statement. “The air conditioning standards alone would cut consumers energy usage by 13 percent. If allowed to stand [13 SEER standard by Clinton], the air conditioner standards would increase the energy efficiency of new air conditioners and heat pumps by 30 percent, effective 2006. The energy savings from the standard would eliminate the need to build as many as 140 additional power plants by 2020.”

During this comment period, expect both sides to state their respective cases to the DOE. ARI said it will be monitoring DOE’s actions accordingly.

“For millions of Americans, air conditioning is a necessity, even a lifesaver in heat waves,” said ARI president Clifford H. “Ted” Rees, Jr. “We need a policy that balances the costs and payback of high efficiency, including the reality that people forced to incur unreasonable costs will delay moving to higher efficiency equipment.”

Sidebar: Administration Proposes Other Efficiency Cuts

The Department of Energy’s (DOE’s) solar, wind, and other renewable energy programs would be cut from present annual spending levels of $376 million to $186 million, and efficiency research programs would be reduced by $61 million to $795 million. The proposed budget covers the government’s fiscal year beginning Oct. 1, 2001.

In total, the DOE budget would be reduced by $456 million to $19.2 billion. The proposed budget includes spending $150 million to develop less-polluting coal for electricity generation and strong support for nuclear power. It also includes $120 million in increased funding for low-income weatherizaton programs, the latter drawing approval by ASE.

Energy Secretary Spencer Abraham also noted an increase in the DOE science budget of $30 million to fund biomass research, “a promising renewable energy source.”

Looking forward, the administration proposes to spend $1.2 billion in bonus bids for oil and natural gas leases in the Arctic National Wildlife Refuge in 2004 for alternative energy programs in a seven-year period. Opposition to Arctic drilling could mean that money would never materialize, however.

“The administration’s proposal to cut energy efficiency research and development and related spending by 20% — even as they declare an ‘energy crisis’ — could not come at a worse time for American consumers and businesses,” according to David M. Nemtzow, president of ASE.

“The nation needs to invest more heavily in energy efficiency, which remains the cheapest, quickest, and cleanest way to lessen energy problems and extend energy supplies.”

ASE describes itself as a “coalition of prominent business, government, environmental, and consumer leaders who promote the efficient use of energy worldwide to benefit consumers, the environment, economy, and national security.”

ASE board members include Michael R. Bonsignore, chairman and ceo, Honeywell Inc.; top officers of three utilities and/or energy corporations; and officers of New York, Vermont, and California government energy agencies.

Publication date: 04/23/2001