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Designating Efficiency Levels for Product Categories

The Federal Energy Management Program (FEMP) is authorized by Congress to designate product categories that have the potential to generate significant energy savings. Products in these categories must meet efficiency levels set by FEMP or the U.S. Environmental Protection Agency’s ENERGY STAR program.

These steps describe FEMP’s process for designating new product categories and updating efficiency levels for current product categories. Learn about how to suggest a new product category.

Step 1: Assess Federal Energy Savings

To determine if a product category should be considered for a FEMP-designated efficiency requirement, FEMP assesses the federal energy savings potential of a product category and takes into consideration a variety of factors, including:

  • Number of products purchased throughout the federal government
  • The product's typical usage pattern (the amount of time spent in each of the various modes of operation)
  • Energy or costs that may be saved by applying various technologies, operating procedures, or design practices
  • Product lifetime and frequency of replacement
  • Applicable standards and legislation that may affect a product's energy consumption, cost of operation, and availability
  • Extent to which potential energy savings and cost reductions may be impacted by installation practices or system interactions (these factors are similar to ENERGY STAR considerations when estimating national energy savings potential)
  • Standardized installation procedures.
Step 2: Set Federal Efficiency Requirements

FEMP prioritizes product categories based on their relative federal energy savings potential to maximize program benefits given limited resources. For products with the greatest potential and that meet FEMP's guiding principles, FEMP collects and analyzes market data to identify and set a minimum energy efficiency requirement for federal acquisition that will differentiate products representing the top quartile of efficiency.

To set required efficiency levels, FEMP considers:

  • Will federal energy savings be significant?
  • Are products that meet the identified efficiency level available from multiple sources (generally at least three)? In most cases, federal purchasers are required to consider multiple sources when justifying a purchase.
  • Will products meeting the identified level be life cycle cost effective for typical federal usage?

In answering the last question, FEMP compares the life cycle cost of the top 25% most efficient products against the least efficient or base model products. If the combination of purchase price and operating cost discounted over the life of the product is less for the top 25% than for the base models, this product category is eligible for FEMP designation.

Step 3: Issue Efficiency Requirements and Guidance

FEMP issues efficiency requirements for energy- and water-efficient product categories and guidance that encourages federal agency acquisition and use. FEMP does not label specific products as being efficient. Federal procurement officials are required to specify or select only those products that meet the designated efficiency levels.

Step 4: Review Efficiency Requirements and Guidance

FEMP completes regular reviews of the efficiency requirements and acquisition guidance in the product categories every two years. During these reviews, FEMP determines whether the product category efficiency requirements should be left unchanged, updated, or suspended. Product categories for which efficiency requirements need to be updated are prioritized relative to proposed new product categories on the basis of federal energy savings potential.


How FEMP Calculates the Upper 25%

FEMP compares the life cycle cost of the top 25% most efficient products against the least efficient or base model products. For example: If, in a given category, some models consume 1 kWh per year and others consume 100 kWh per year, the required consumption level for the FEMP-designated product category is set at 25 kWh per year. Any product that uses less than 25 kWh per year meets FEMP-designated requirements for that product category.