California Can’t Wait for Federal TV Energy Standards, Says CEC Chairman

Committee members grilled Douglas on the cost to consumers from the proposed standard and on retailers’ concerns about consumers getting TVs from out of state via the Internet. She also dealt with industry concerns that the standards would stifle innovation, an issue raised by Committee Chairman Felipe Fuentes, D-Sylmar, in his opening statement. Fears of the TV specs throttling innovation stem largely from a “misunderstanding” of the test procedure, said Douglas. When TVs are tested for compliance with the specification, “non-essential” features such as VCRs, DVDs, Internet connections and iPod docks are turned off, she said. “We test it the same way the fuel efficiency of a car” is tested, she said: “You don’t test the efficiency of the car with the air-conditioner on.”

What the test does is measure the “core consumption” of TVs, Douglas said. And the test procedure that the CEC has adopted was “developed largely through a consensus process” involving the DOE, the CEA and other industry stakeholders, she said. “It is accepted worldwide and it [ensures] that nonessential features are not on when it runs.” As for industry’s contention that voluntary programs like Energy Star are working well to make CE products more energy efficient, Douglas said Energy Star doesn’t ensure that all TV models meet “minimum basic standards.” “Energy Star is a pull and standards are push,” she said. “The role of standards is to eliminate the least-efficient products, and that’s what we are talking about here.”

Jean Fuller, R-Bakersfield, voiced concern that forcing plasma TVs to bring their brightness level down would “put them out of business.” Bill Stark, CEC legal counsel and engineer, said the commission has talked to the plasma TV industry and “they have informed us that there is not a problem” in meeting the CEC’s tier one specification. “We are not seeing that the light[ing] is going to be so low that there is going to be a problem.”

Fuentes said retailers were concerned about Internet sales and wanted to know how the CEC would enforce compliance. “How do you make sure that we don’t have these rogue TVs coming into California” via Internet sales, he asked. Douglas said the CEC believed that TV makers can meet the standards without “cost premiums” and so there would be no need for consumer to shop on the Internet. “When a consumer walks into the store in 2011 or 2013 the store will not look any different,” she said. “They will be filled with TVs of all sizes” and the “range of features” that will be available then, she said. Douglas told Fuentes that she believes that there will be no “product elimination” as a result of the standards.

Nathan Fletcher, R-San Diego, said his main worry about the proposed regulation was the “cost to consumers.” He proposed that the CEC make a “good first step” with a labeling requirement and educating consumers about savings from energy-efficient TVs rather than mandating energy limits. Consumers will make the right purchasing decision if they have all the information, he said. Douglas said that, while many consumers may be “motivated by labeling,” others may not. “One of the real advantages of standards is that it sets a floor below which no television will sink,” she said. “It’s the same way regulations protect consumers from unsafe food or from dirty air or other potential harms.” There’s also a “social cost” to “not taking advantage of cost-effective opportunities to rein in our energy use,” Douglas said.

While California is the leader in driving energy efficiency in the U.S., the state is “more or less where the rest of the world and other major markets” are in terms of TV standards, Douglas said. Europe and Australia already have set standards for TVs; Japan, China and India have labeling requirements and standards; and Canada is weighing regulations as well, she said. The U.S. is the only major market that does not have standards, she said. “I don’t think California wants to be behind,” Douglas said. “I don’t think we want to get the TVs that don’t make the grade in other markets and be stuck with higher energy use and higher energy bills.”

CE industry representatives called the hearing “extraordinary” because the legislature was out of session “yet showed its concern for the issue. We're gratified,” said Doug Johnson, CEA senior director of technology policy. Nine members of the California senate and assembly attended the nearly five-hour hearing, said Peter Fannon, Panasonic vice president for technology policy, government and regulation. Several legislators also met with CE representatives before the hearing, Fannon told us.

As expected, CE groups hammered hard at the CEC’s research and methodology in arriving at the need for power regulation. “There are errors and flaws in the CEC’s calculations about TV power use and about the potential savings from its arbitrary limits,” Johnson told us. In his testimony before the panel, he said the CEC was using data that was three-years-old and sometimes offered “no footnotes for credible references.” Power-use data supplied by the NRDC and used by the CEC “predated any standards for measuring energy use by TVs,” Johnson said. “It’s very clear that the CEC can’t pass regulations at this time unless they use old data,” Johnson said. “They must ignore reality to do it, and they have ignored up-to-date input they requested from us and that we supplied.” If the CEC used more-current data “it will find the Tier 1 and 2 limits it would set are not justified,” he said.

CEA also attacked the CEC’s calculations on power- savings to Californians, Johnson said. “There are mathematical problems in the CEC’s calculations that make their projected savings evaporate,” he said. “The commission says its regulations would save Californians $8.1 billion through 2022. Actually, it’s more like 3 to 4 billion dollars,” he said, citing research by an independent economics firm retained by the CEA. “Then, when you factor in information they've ignored, like the impact of Energy Star, and competition and innovation among TV makers going forward, the CEC’s projected savings are a house of cards,” Johnson said.

The CEC’s fact-finding had “egregious errors” and shows the commission “is not well positioned to address CE product issues,” Johnson said. “We urged the legislators to revisit the Warren-Alquist Act that created the Commission, and enact new checks and balances and flexibility about the CEC’s authority,” he said.