In a landmark development, leaders of the HVAC industry have agreed to accept regional energy efficiency standards after years of vigorously opposing the idea. The position emerged from a voluntary agreement signed by executives from the Air-Conditioning, Heating, and Refrigeration Institute (AHRI); more than a dozen individual furnace and air conditioner manufacturers; and seven different energy-efficiency advocacy groups, including the American Council for an Energy Efficient Economy (ACEEE), and the Alliance to Save Energy (Alliance).

After months of negotiations, the parties collectively agreed to support new federal standards for furnaces, heat pumps, and residential air conditioners. The new standards would raise the minimum efficiency of residential central air conditioning systems by about 8 percent and furnaces by about 13 percent. More importantly, the parties agreed to  call for regional efficiency standards to replace a quarter-century of national standards.

The agreement sets different standard levels in three climate regions — North, South, and Southwest, recognizing that appropriate investments in heating and cooling efficiency depend on usage. Such regional standards are allowed under the Energy Independence and Security Act of 2007.

The agreement also allows states to include even higher efficiency levels for heating and cooling systems in new homes, given that new houses can be built without the physical restrictions of existing houses that can hinder installation of newer high efficient equipment. This new approach is meant to strike a balance between the desire for greater state and regional flexibility and the need for a uniform marketplace for equipment manufacturers.

In a joint announcement, the groups said that the new standards are projected to save U.S. consumers about $13 billion in today’s dollars between 2013, when the new standards begin to take effect, and 2030. (The figure takes into account the incremental cost of the more efficient equipment.)  Furthermore, they said that between now and 2030, the agreement also will save 3.7 quadrillion BTUs of energy nationwide.

The signatories agreed to submit their agreement jointly as a legislative proposal to Congress for inclusion in the energy legislation currently under consideration. The groups will also recommend that the Department of Energy promulgate a rule adopting the agreed-upon regions and efficiency standards.  

“In addition to saving significant amounts of energy for the nation — and saving consumers considerable money, this agreement provides industry with greater certainty in the marketplace, which enables more investment, enhances global competitiveness, and preserves jobs,” said Stephen Yurek, president of AHRI.

Steven Nadel, executive director of ACEEE, observed, “We believe this proposal represents a large leap forward in improving our nation’s energy efficiency, while also reducing consumer energy bills and helping to clean our environment. Regional standards are a major step for cost-effective savings, and will help manufacturers meet the very different needs of homes in cold, hot-humid, and hot-dry climates.”

The joint agreement also recommended more stringent building code provisions for new construction. Kateri Callahan, president of the Alliance, noted that constructing buildings efficiently from the ground up is the best way to maximize savings of energy, money, and emissions. She said that the building codes provision of the agreement is especially significant, as it allows states to adopt codes that will ensure major savings for new homeowners while also taking a bite out of global warming.

TOOLMAKERS MERGE

The Stanley Works, New Britain, Conn., and The Black & Decker Corp., Towson, Md., announced a merger agreement to create Stanley Black & Decker. The new company represents about $8.4 billion in sales. The all-stock transaction is valued at about $4.5 billion. Stanley brands include Stanley, FatMax, Bostitch, Facom, Proto, Mac Tools, Sonitrol, Stanley Security Solutions, Best, and Vidmar. Black & Decker brands include Black & Decker, DeWalt, Porter-Cable, Emhart Teknologies, Kwikset, Baldwin, and Price Pfister.

UL VALIDATES LGE

LG Electronics USA, Englewood Cliffs, N.J., is the first consumer electronics and appliance manufacturer to have products assessed via the UL Environment Environmental Claims Validation program. UL Environment is a subsidiary of Underwriters Laboratory that offers testing and validation of manufacturers’ self-declared environmental claims. The subsidiary was established in January 2009 to help provide guidance and clarity for both consumers and manufacturers regarding environmental claims. For LG, the lab tested and validated claims for the LG SteamWasher (WM3001HWA) and the LG LCD television 47LH90. The washer was tested for energy and water savings; the TV was tested for overall energy consumption in both the on mode and standby mode.

SUB-ZERO ADDS

Increased demand for Sub-Zero and Wolf appliances has prompted the company to add a second production shift at its factories in Fitchburg, Wis., and Phoenix, Ariz. The company had cut its workforce earlier in the year, but has called back 40 hourly employees at its Arizona plant, and 165 in Wisconsin, and said it will hire an additional 60 people for salaried positions. The company is based in Madison, Wis.

MIELE IN INDIA

German home appliance maker Miele has begun marketing its products in India. Targeting the affluent part of the population, Miele will sell a wide range of premium appliances. The initial focus will be on large urban areas, beginning with 10 distribution points in the Delhi/National Capital Region.

ELECTROLUX CLOSINGS

AB Electrolux, Stockholm, announced plans to discontinue production at a factory in Alcala, Spain, in 2011. The plant, which makes clothes washers, employs 450 people. Electrolux Major Appliances North America, Augusta, Ga., announced plans to close two plants in Iowa by the spring of 2011. The plants in Webster City and Jefferson produce laundry products. Manufacturing of those products will shift to Juarez, Mexico. Roughly 850 jobs will be lost.

HEATCRAFT TRIES CO2

Heatcraft CO2 unit cooler.

Heatcraft Refrigeration Products, Stone Mountain, Ga., has introduced a new line of unit coolers using carbon dioxide as the refrigerant. Rolled out under the Bohn brand, the equipment is targeted toward the needs of supermarkets. The line includes 62 models with capacities that match standard models. The move was meant to accommodate customers who are concerned about the global warming potential of HFCs. Heatcraft said that, in addition to addressing GWP concerns, the units provide better temperature control and space savings.

LUVATA IN MEXICO

Luvata has opened a copper-tube manufacturing plant in the Monterrey area of Mexico. The new facility was designed to deliver fast and frequent orders to nearby HVAC/R customers. The plant is meant to complement an existing facility in Franklin, Ky. Luvata is based in Sweden.

NORTEK REORGANIZES

In October, NTK Holdings, Inc., Providence, R.I., and its 37 affiliate companies, filed for bankruptcy protection under Chapter 11. That includes the subsidiary Nortek, Inc., which makes HVAC equipment. The company plans to conduct business as usual throughout the proceedings and expects to exit bankruptcy in December or January.

DYSON IN MALAYSIA

The British appliance maker Dyson plans to boost the R&D capabilities of its Malaysian operations by adding another 100 engineers to the current engineering staff of 300. The company wants to make the Malaysian unit a center of engineering excellence. The company had shifted production of its product from the U.K. to Malaysia earlier this decade.

DELL CLOSING IN N.C.

Computer maker Dell announced plans to close its manufacturing plant in Winston-Salem, N.C. in January. Approximately 905 people will be affected by the closure. The announcement has helped rekindle a debate over the value of regional incentives used to lure businesses to a specific area. Both state and local governments had provided Dell with millions of dollars worth of incentives to attract the Dell operation to that location. Dell is expected to repay most of the incentives it received, according the original agreement.

NEW AFUE IN CANADA

Effective January 1, 2010, all gas-fired furnaces (propane or natural gas) with an input rate not exceeding 65.92 kW (225,000 BTU/H) manufactured for sale in Canada must achieve a minimum of 90 percent annual fuel utilization efficiency (AFUE). Furnaces less than 90 AFUE manufactured before January 1 can continue to be sold and installed. One of the exceptions is through-the-wall gas furnaces. The 90 AFUE minimum for those products will not take effect until December 31, 2012.

FUNDS TO WHIRLPOOL

Whirlpool Corp., Benton Harbor, Mich., will receive federal stimulus funds as part of the U.S. Department of Energy Smart Grid Investment Grant program. The grant of $19.3 million will be matched by Whirlpool and will be used to help the company develop smart appliances that can connect with the smart grid. The company had previously announced its intention to deliver 1 million smart clothes dryers in 2011. These dryers would be able to react intelligently to signals from the smart grid.

INSULATION EXPANSION

Lydall Performance Materials, Manchester, Conn., commissioned a new needled fiber product operation at its Green Island, New York, facility to enhance its portfolio of high performance needled glass mat products that serve the appliance industry. Applications for the products range from residential ovens to water heaters to commercial boilers.

TESTING IN TEXAS

Underwriters Laboratories, Northbrook, Ill., opened a new HVAC/R Performance Test Center in Plano, Tex. When fully equipped, the facility will house seven, dual-cell, psychometric testing rooms for equipment requiring precise temperature and humidity control. Examples include package terminal heat pumps, commercial icemakers, remote refrigerated display merchandisers, and variable refrigerant flow multi-split equipment.

GAS COOKTOP TO U.S.

LGE gas cooktop.

LG Electronics USA, Englewood Cliffs, N.J., has launched its first line of gas cooktops for the U.S. market. Available in 30-in. and 36-in. sizes, the appliances feature a contemporary stainless steel styling, three heavy-duty continuous burner grates, professional-grade knobs, and blue LED lighting. Both models range in power from 5,000 BTUs to 19,000 BTUs, with a large center burner offering a 19,000 BTU output.

CSA APPOINTS CEO

The board of directors of CSA Group appointed Ash Sahi as president and CEO of the Canadian Standards Association. Sahi replaces Robert M. Griffin who retired. Sahi has more than 30 years of experience in global business and a long track record in government relations.

JENN-AIR AT SEARS

Jenn-Air oiled bronze appliances.

Sears Holdings, Hoffman Estates, Ill., announced an agreement with Whirlpool Corp., Benton Harbor, Mich., that will make Sears the only national retailer to carry the new collection of Jenn-Air super-premium appliances. The appliances began arriving in 255 of Sears’ biggest stores in November, and included wall ovens, cooktops, microwaves, ranges, built-in refrigerators, ventilation products, and dishwashers. After January 1, 2010, Whirlpool will no longer supply Jenn-Air appliances to Home Depot and Lowe’s, but said it will continue to provide the brand to independent distributors.

DOE Gets Tough

The U.S. Department of Energy (DOE) announced three new steps to strengthen its ability to enforce energy efficiency standards. The first step is the formation of an enforcement team within the Office of the General Counsel. The second is a program to randomly review manufacturers’ compliance with DOE certification requirements. The third is the issuance of guidance that further details the agency’s energy efficiency enforcement regulations.  

In its new guidance on Energy Efficiency Enforcement Regulations, the Department confirms that under existing DOE regulations, DOE can take enforcement action and assess civil penalties if a manufacturer fails to properly certify a covered product and retain records.  Specifically, the Department clarifies that any failure to certify covered products according to DOE’s rules violates the Energy Policy Conservation Act of 1975 and DOE’s regulations.

The new enforcement team, reporting to the General Counsel, is comprised of lawyers with extensive litigation and regulatory experience. As part of its increased enforcement efforts, the enforcement team will be initiating a compliance review of certification reports for covered consumer products. DOE will randomly select previously filed certification reports for review, request certification records as needed, and hold manufacturers accountable for failing to certify covered products according to DOE rules.

In its announcement, DOE referenced its recent investigations of alleged violations against both an air conditioner manufacturer and a freezer manufacturer, and said those investigations are expected to be concluded shortly.