Feds Chill Out Fridge Rules—Business as Usual
Published Date: 1/21/2025
Rule
Summary
The Department of Energy is rolling out new energy-saving rules for commercial refrigerators, freezers, and fridge-freezers. These updated standards, effective March 24, 2025, must be followed starting January 22, 2029, helping businesses save energy and money while using the latest tech. If you own or make commercial refrigeration equipment, get ready to upgrade and save!
Analyzed Economic Effects
6 provisions identified: 4 benefits, 2 costs, 0 mixed.
Nationwide Energy Savings Large
For CRE purchased during 2029–2058, DOE estimates lifetime energy savings of 1.11 quadrillion Btu (quads), a 6.5 percent reduction versus the no-new-standards case. The standards are estimated to reduce CO2 by 19.7 million metric tons and lower SO2, NOX, CH4, N2O, and Hg emissions by specified amounts over the same period.
Annualized Monetized Net Benefits
DOE estimates the adopted standards increase equipment costs by about $71 million per year (7% discount case) while producing annual reduced operating costs of $210 million, climate benefits of $222 million (using 2023 SC-GHG) or $64 million (using 2021 interim SC-GHG), and health benefits of $90 million. In that scenario the net annual benefit is $452 million (using 2023 SC-GHG) or $294 million (using 2021 interim SC-GHG); alternative 3-percent discount scenarios yield higher net benefits ($545 million or $387 million).
Final Standards and Compliance Dates
The rule becomes effective March 24, 2025, and businesses and manufacturers must comply with the new standards on and after January 22, 2029 (four years after publication). The standards apply to equipment manufactured in or imported into the United States starting on that compliance date.
Businesses: Positive Lifetime Savings
DOE found the average life-cycle cost (LCC) savings are positive for all covered equipment classes, and the simple payback period (PBP) for the adopted standards is less than the estimated average CRE lifetime of 14.0 years. That means businesses that replace equipment to meet the new standards are estimated to save more in operating costs over equipment life than the added purchase cost on average.
Manufacturer Conversion Costs and INPV Loss
DOE estimates industry conversion costs of $117.7 million to bring equipment into compliance. The industry net present value (INPV) is estimated to decline by -2.6 percent to -1.7 percent (about -$77.8 million to -$51.3 million) under the adopted standards versus no-new-standards.
Large-Capacity Classes Left Unamended
DOE is not amending standards at this time for certain large-capacity CRE classes (listed in the rule, e.g., VOP.SC.M, SVO.SC.M, HZO.SC.L, SOC.SC.M, VCT.SC.M, VCT.SC.L, VCS.SC.L). Large-capacity units in those classes remain subject to the current standards for which compliance began March 27, 2017.
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Key Dates
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