THE SOURCE - Spring 2016 - (Page 30)

at last Push for a Common Sense Approach to Furnace Efficiency Standards It was wonderful to see many friends and colleagues at the 2015 Gas Utility Management Conference at the historic Omni Grove Park Inn in Asheville, N.C., which is one of mine and Nancy's favorites! Although rain caused the reception to be moved indoors, we were fortunate to catch the fall colors at the height of their beauty. The conference provided timely information on issues impacting the daily operations of a public natural gas utility. I now look forward to attending the 2016 Gas Supply Conference to be held in Tucson, Ariz., in late January, and the triple-combination 2016 Marketing & Sales Trends & Training Conference, Security and Integrity Foundation Operations Conference, and Gas Policy Conference to be held in Savannah, Ga., at the end of March. The MSTTC and SIF Operations Conference combination has been one of the best attended conferences over the past few years, with MSTTC providing exceptional speakers and presentations to help attendees increase the use of natural gas in their communities, while the SIF Operations Conference focuses on pipeline safety and new technology for natural gas operations and pipeline safety. The new Gas Policy Conference (GPC) was added to address issues on natural gas policy and the effects on the natural gas direct-use market. APGA continues to push for a common sense approach to furnace efficiency standards. As you are probably aware, in March 2015, the Department of Energy (DOE) released a Notice of Proposed Rulemaking (NOPR) that proposes a new nationwide standard of 92 percent annual fuel utilization efficiency (AFUE) for natural gas furnaces. The end result of this NOPR is a ban on the sale of non-condensing furnaces in the United States since condensing furnaces are the only ones capable of meeting the higher efficiency standard. Because of the difference in combustion technology, condensing furnaces have additional venting requirements associated with their installation that add significant dollars to their overall costs. This raises serious fuel switching issues for APGA and its members, as many consumers, especially those in fixed and low income brackets, will switch to a lower first cost, albeit less efficient, electric furnace to avoid the installation costs of a condensing furnace. Given that natural gas is 92 percent efficient on a primary energy basis, a standard that encourages consumers to switch to other heating options makes no sense and certainly runs counter to the goal of increasing efficiency. A thorough review of the technical data DOE used to justify the NOPR revealed DOE's economic analysis is flawed. There has been a serious lack of transparency in this rulemaking process, which was highlighted by the fact APGA had to spend $15,000 to purchase the private studies referenced and utilized by DOE in their justification of lifecycle costs. APGA maintained there is no need for the NOPR given that the market is working when it comes to the sale of high efficiency condensing furnaces in those areas of the country where condensing furnaces make economic sense, and DOE has violated the Energy Policy and Conservation Act and its own precedent in not establishing a separate standard for non-condensing furnaces. The good news is we have seen some movement recently from DOE that indicates they have begun to recognize the need for both a condensing and non-condensing product class. This occurred in a September Notice of Data Availability (NODA) seeking comment on an analysis of the potential economic impacts and energy savings that would be obtained through the creation of a separate product class for small furnaces. This separate product class would be exempt from DOE's nationwide standard. The bad news is that APGA continues to be frustrated by DOE's process. In this case, APGA asked for an extension of the NODA comment period, but since we received no response from DOE, we filed our comments prior to the October 14 deadline. On October 15, DOE reopened the comment period. It is very troubling to APGA that it appears several of the groups supporting DOE's furnace NOPR did not submit comments on October 14 because they were aware that DOE would be reopening the comment period. These actions by DOE, which appear intended to further tilt the playing field to the advantage of its allies, are certainly not tolerable in a rulemaking process supposedly dedicated to due process. APGA has asked the Secretary of Energy and the DOE Inspector General to look into the manner in which the NODA extension was handled and to restore fairness into this rulemaking proceeding, which in my opinion has been anything but fair. APGA will continue to work towards a common sense approach to furnace standards that increases efficiency, but we will strongly oppose any standard that encourages fuel switching away from natural gas and increases consumer costs. We continue to fight for natural gas-the fuel of freedom! All the best, Richard H. "Rich" Worsinger Chairman, APGA, 2015-2016 30 THE SOURCE | THE vOiCE and CHOiCE Of pUbliC gaS

Table of Contents for the Digital Edition of THE SOURCE - Spring 2016

First Person
APGA Events
A Friendly Business Partnership of Two of the Nation’s Largest Utilities Can Benefit the Natural Gas Industry
Natural Gas Direct-Use in Net Zero Energy Buildings
Henry Hub and Changing Liquidity in the North American Gas Market
Cold Season Planning Preparedness: From Supply to Delivery
Natural Gas Power Plant Opportunities
Legislative Outlook
The Pipeline
Marketing Matters
Advertisers’ Index/
At Last

THE SOURCE - Spring 2016