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Product Designation Process

The process for designating products was developed to maximize energy savings within Federal agencies, which are required by law to purchase products designated by the Federal Energy Management Program (FEMP) or qualified by ENERGY STAR. Products that meet FEMP-designated efficiency requirements are in the upper 25% of their class in energy efficiency.

Product efficiency requirements have been voluntarily adopted by many non-Federal organizations. FEMP encourages commercial, residential, or public sector organizations to adopt these or similarly rigorous minimum efficiency levels for their own procurement practices. Many FEMP-designated efficiency requirements can be easily adopted for commercial or public sector applications.

Federal agencies use a wide variety of energy-consuming products. While many are covered by the ENERGY STAR program, some are not. Congress authorized FEMP to designate energy-efficient product efficiency levels for Federal purchases and requires Federal agencies to specify or select only products meeting these efficiency levels where applicable. FEMP product efficiency requirements set minimum efficiency levels for product categories that have the potential to generate significant Federal energy savings.

FEMP does not purchase, recognize, endorse, or otherwise identify specific energy-efficient products for Federal procurement. Instead, FEMP identifies energy efficiency requirements for a category of products, which is typically an energy consumption level within the upper 25% of the product category.

FEMP provides acquisition guidance for FEMP-designated and ENERGY STAR product categories, lists ENERGY STAR performance specifications where applicable, and sets energy efficiency requirements for FEMP-designated product categories. FEMP also maintains a list of products that meet FEMP-designated standby power requirements, found in the Low Standby Product List.

FEMP does not test or measure product energy consumption. The program depends on outside sources (such as ENERGY STAR, manufacturers, or industry organizations) for product energy consumption data.

Process Overview and Guiding Principles

FEMP and ENERGY STAR share a core set of guiding principles with slight differences. The FEMP guiding principles for setting energy efficiency requirements are:

  • Significant energy savings can be realized on a Federal Government basis
  • Products meeting FEMP product efficiency requirements may be assumed to be life cycle cost effective
  • Energy efficiency can be achieved with several technology options, at least one of which is non-proprietary
  • Product energy consumption and performance can be measured and verified with industry-recognized testing standards
  • Setting Federal requirements can effectively differentiate products representing the top quartile of cost reduction and efficiency and institutionalize energy efficiency and cost savings

FEMP uses its guiding principles to identify and prioritize products to be covered under the FEMP-designated efficiency requirements program (Step 1). Having identified qualified product categories, FEMP then conducts market research to confirm that the category is a good candidate for FEMP-designation and then sets efficiency requirements (Step 2). FEMP reviews covered product categories once every two years and also periodically analyzes energy savings potential within the Federal market (Step 3). These reviews then guide the selection of product categories (Step 1).

Step 1: Product Category Selection Criteria

To determine if a product category should be considered for a FEMP-designated efficiency requirement, FEMP first assesses the Federal energy savings potential of a product category. FEMP draws potential product categories primarily from three main sources:

For all potential product categories, FEMP assesses Federal energy savings potential, taking into consideration a variety of factors, including, but not limited to:

  • Number of products purchased throughout the Federal Government
  • The product's typical usage pattern (i.e., the amount of time spent in each of the various modes of operation)
  • Amount of energy and/or costs that may be saved through the application of different technologies, operating procedures, or design practices
  • Product lifetimes 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)

It is FEMP's goal to create efficiency requirements for only those product categories where it is clear that the Federal energy savings potential of a product will translate into tangible cost savings when the product is placed in a Federal facility. That is, installation procedures are standardized to the extent possible and are likely to have little or no impact on the Federal Government's ability to realize the product's energy efficiency and cost effectiveness.

Before undertaking a full market analysis, FEMP frequently considers the availability of relevant market data and an industry-recognized testing standard. Without these items, FEMP would be unable to produce an efficiency requirement level that represents the full spectrum of available goods and that could be used to identify and compare specific products.

Step 2: FEMP Process for Setting Federal Efficiency Requirements

FEMP prioritizes product categories based on their relative Federal energy savings potential to maximize program benefits given limited resources. For those 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.

In setting the required efficiency level, FEMP once again considers its guiding principles, particularly:

  • At the identified level, will potential Federal energy savings be significant?
  • Are products that meet the identified level available from multiple sources (generally at least three or more)? 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?

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

How Does FEMP Calculate the Top 25%?

If, in a given category, there are some models that consume 1 kilowatt-hour (kWh) per year and others that consume 100 kWh per year, the required consumption level for the FEMP-designated product category will be set at 25 kWh per year. Any product that uses less than 25 kWh per year will meet FEMP-designated requirements for that product category.

Step 3: Bi-Annual Review of Acquisition Guidance and Federal Efficiency Requirements

FEMP reviews existing acquisition guidance and purchasing requirements at least once every two years. For ENERGY STAR product categories, FEMP coordinates with ENERGY STAR to reflect changes in ENERGY STAR specifications in a timely manner. In reviewing FEMP-designated efficiency requirements, FEMP conducts a preliminary analysis to determine if there have been any substantial changes in the concerned market, such as new technologies becoming available, new national standards coming into effect, or an increased or decreased spread between the least efficient and most efficient model available in the category. FEMP also reviews and updates all acquisition guidance language as necessary and appropriate during this bi-annual review.

During its bi-annual review, 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 will be considered and prioritized relative to proposed new product categories on the basis of Federal energy savings potential.

How to Suggest a New FEMP-Designated Product Category

If you would like to suggest FEMP consider adding a new product category, submit the following information to Mark Reichhardt.

  • The proposed product category

  • An industry-recognized standard test procedure to determine annual energy consumption, including standby energy consumption, for all products within the category

  • An outside data source that provides annual energy consumption information for all products within the category sold in the United States, as tested by the standard procedure. The data source can be any publicly available information, such as a database that lists information on annual energy consumption or a product specification sheet that includes energy efficiency information. The same underlying test procedure should be used for all products in the category so buyers and the U.S. Department of Energy can compare product efficiencies.

  • Data covering the installed base of a particular product category within the Federal Government, or the annual number of products purchased within that category in the Federal sector. If you are estimating product purchase volumes in the Federal sector, provide background information for your estimate so that DOE can determine the significance of a proposed product category relative to currently covered product categories.

With this information, FEMP will determine if a new product category is needed. This information must cover ALL products within the category sold in the United States not just products manufactured by a particular company.

In absence of these elements, please provide FEMP with any data or information that suggests the product category would benefit from a Federal efficiency requirement. FEMP will retain this information to help build a case over time for a specific product category.