New Appliance Labels Emphasize Energy Use

The most noticeable change is that the new labels emphasize energy use rather than estimated costs. For clothes washers, dishwashers, refrigerators, and water heaters, estimated energy use in kWh per year or therms per year is now the most prominent piece of information. An arrow shows where the product falls within the range of comparability for similar products-that is, between the model that uses the most energy and the one that uses the least energy. Energy cost is still estimated, but in smaller print, along with concise explanations of the ratings.

The FTC changed the labels' emphasis to energy use because consumers' groups and manufacturers complained that the estimated energy cost was confusing. The cost estimates are based on the average cost for energy in the United States, which is calculated by the U.S. Department of Energy. Before, appliances had to be relabeled when either this cost or the range of comparability changed 15% or more. (The range of comparability changes with the introduction of new products.) So, for example, in 1987 customers might have looked at a 1985 display model with an estimated energy cost of $100, only to find, when they had one ordered and delivered, that the energy cost had changed to $115. The appliance's energy use had not changed, so the display model was kept around, but the rise in the average cost of electricity had resulted in a higher operating cost on the label.

Another change is in the range of comparability. The FTC now compares products within the more specific subcategories used by DOE for appliance standards. In the past, for example, all refrigerators of similar capacity were included in one category for comparison. The new labels, however, compare side-by-side refrigerator-freezers only with other side-by-sides, not with top-freezer models.

Heating and cooling equipment will be labeled with standard industry efficiency ratings, such as Annual Fuel Utilization Efficiency (AFUE) for furnaces, Seasonal Energy Efficiency Ratio (SEER) for air conditioners, Heating Seasonal Performance Factor (HSPF) for the heating mode of heat pumps, and Thermal Efficiency (TE) for pool heaters. Manufacturers of these appliances need to provide detailed fact sheets of estimated energy costs, unless the model is listed in an approved manufacturers' directory, like the ones from the Air Conditioning and Refrigeration Institute (ARI), the Hydronics Institute, or the Gas Appliance Manufacturers' Association (GAMA).

The labels have also been simplified. Consumer research in the United States and Canada indicated that the old labels contained too much information. For example, the old clothes washer and dishwasher labels prominently displayed two sets of cost figures: one each for electric and gas water heating (see Figure 1). Now the main rating is in kWh per year, with one average figure each for gas and electric water heating dropped to the smaller print below (see Figure 2).

International pressures also influenced the changes. Under the North American Free Trade Agreement (NAFTA), the FTC must harmonize its Energy Guide program with Canada's Energuide program. Canadian appliances were already rated by energy use. However, the FTC chose not to require metric ratings on all Energy Guide labels, because consumers in the United States are not as familiar with metric units.

Another change that did not make it onto the new labels was an estimate of water use for washing machines. Despite a suggestion from the Environmental Protection Agency, the FTC said that it did not have the authority to rate or label water use.

The new labels were required on most appliances by November 1, 1995; a few appliances (including refrigerators) may not be relabeled until early 1996.

-Jeanne Byrne and Steven Bodzin

Figure 1. Old labels stressed energy cost in dollars, providing a range of information based on varying gas and electric rates.

Figure 2. New labels concentrate on energy usage and estimate the cost only at the national average gas and electric rates.

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