On April 12, the Department of Energy (DOE) published proposed modifications to its Process Improvement Rule of February 2020. The proposal responds to a Memorandum from the White House Chief of Staff directing agencies to review several rulemaking outcomes from the previous Administration.
Before issuance of the February 2020 rule, the National Electrical Manufacturers Association (NEMA) and other trade associations argued the original Process Improvement Rule of 1996 was sorely out-of-date, and its guidance had been interpreted and reinterpreted so many times it was no longer relevant. A practice of “energy-savings-at-all-costs” seemed to be in effect, ignorant of diminishing returns on mature product Standards. The February 2020 Rule made several important changes, including making the process rule’s provisions mandatory, finalizing test procedures ahead of new proposed Standards, increasing transparency, and encouraging rapid assessment of previous rulemaking conclusions (aka “quick look”).
New DOE leadership in the Biden Administration is seeking to overturn the provisions of the February 2020 rule without considering its benefits for the Agency itself.
As required by the Energy Policy and Conservation Act, Standards must be “economically feasible” and “technologically justified.” DOE rulemakings entail the investment of significant staff time and financial resources to determine the positive and negative impacts of a range of potential Standards levels. The resulting analytical reviews then assess the best point at which to strike the balance of positive energy savings versus negative national impacts.
Critics of the February 2020 Process Rule imply that any energy saved or any energy consumption reduced is sufficient to justify tighter regulations for that sector. However, it is worth remembering that most proponents of energy-savings-at-all-costs bear little to no stake or burden in the development or implementation of those Standards. A central purpose of the Process Rule is to reduce inefficient use of government resources and prevent the undue burden of its regulations. Like all agencies, DOE must prioritize its resources and is obliged to apply them where they can provide the most benefit. The simple “quick look” is an excellent tool to allow DOE to assess whether factors such as technological breakthroughs, market transformation, or other changes to market dynamics have occurred, which might warrant deeper investigation by DOE analysts. In contrast, where little or no change in the factors that determined previous conclusions have taken place there would be little benefit from a more thorough investigation.
NEMA supports DOE efforts to implement congressional intent to improve the energy efficiency of appliances, products, and systems. Further, NEMA believes DOE can and should responsibly utilize as many tools as possible to accurately and reasonably justify where public resources should be applied. The Process Improvement Rule of February 2020 provides many such tools and should not be nullified, so DOE can effectively review and revise regulations promptly and wisely.
- By Alex Boesenberg, Director of Regulatory Affairs, NEMA