FTC Final Rule Requires EnergyGuide Labels for TVs Starting May 2011

Among other things, the final rule requires the labels to disclose the unit’s estimated annual energy cost and a comparison of energy costs to similar units. It also requires catalogs and websites to disclose energy information for the TVs they offer for sale.

The final rule is effective on May 10, 2011, with later compliance for the “catalog” requirement, which will become effective on July 11, 2011.

(The Energy Independence and Security Act of 2007 (EISA, Public Law 110-140) authorizes the FTC to require energy disclosures for certain consumer electronics, including televisions, personal computers, cable or satellite set-top boxes, stand-alone digital video recorder boxes, and personal computer monitors.)

Highlights of FTC Responses to Comments

The following are highlights of FTC responses to the 23 comments it received on its March 2010 proposed rule:

Few Screen Sizes in Each Category to Help Consumers, Reduce Cheating

The final rule requires the labels to compare televisions of similar screen sizes. The FTC agrees that the comparison categories should facilitate consumers’ easy comparison of similar products, which reflects how they shop in practice. Accordingly, the final rule adopts commenters’ proposals to reduce the size of the categories to 4-5" in order to place only one or two commonly sold screen sizes in each category. Most of the common screen sizes fall towards the beginning or middle of each category, which should reduce any incentive for “gaming” the system by slightly increasing screen size in order to move up into the next category.

Rule Does Not Require Box Labels, but FTC May Reconsider if Needed

The final rule does not require box labels. Although retailers may in some cases display boxes to consumers pre-purchase, the comments indicate that consumers typically examine a display model before purchase. Rather than impose additional cost, substantial in the manufacturers’ opinions, to label boxes, the final rule relies on labeled models to convey energy cost information. Should this approach prove inadequate, the FTC may revisit the requirement.

Size & Design of Comparison Info Has Changed from Proposed Version

In response to certain concerns about readability, the FTC has for all three label formats, increased the comparison information’s size and changed its design to improve visibility. The overall size of the labels will not increase significantly.

Some Flexibility on Label Placement, 3 Optional Shapes

In response to commenter concerns about screen damage, the final rule allows manufacturers to affix the label anywhere on the television, as long as the label itself is visible to someone viewing the front of the television. Accordingly, the final rule gives manufacturers the choice of using either a rectangular adhesive label adhered to the horizontal or vertical bezel; a triangular cling label affixed to the lower right-hand corner of the screen; or a rectangular or triangular label affixed using an alternate method anywhere on the television.

Using 5/19 Duty Cycle in Energy Cost Estimates Provides Uniformity

Even though consumers may use their televisions for more or less than five hours per day, FTC believes that the “5/19 duty cycle” required in the final rule to calculate annual estimated energy cost and use provides uniformity between the EnergyGuide and ENERGY STAR’s publicly available use estimates, reducing potential consumer confusion.

Highlights of Final Rule

The following are highlights of the final rule:

Definition of TV. Television will mean a commercially available electronic product designed primarily for the display and reception of audiovisual signals from terrestrial, cable, satellite, Internet Protocol TV (IPTV), or other transmission of analog and/or digital signals, consisting of a tuner/receiver and a display encased in a single housing. This definition does not cover models that are designed to operate on built-in rechargeable batteries or inserted batteries.

Product labeling. As described above, the final rule will require manufacturers to affix EnergyGuide labels to televisions on the product’s bezel in the form of a small rectangular adhesive label, on the screen in the form of a small triangular cling label, or using an alternate method of attachment that permits the label to be clearly visible from the front of the television. The primary disclosure on the label is the product’s estimated annual energy cost. The basic colors of all labels will be process yellow or equivalent and process black (like those used in EnergyGuide labels for other products).

Label content. The label will have to include the headlines, texts, and statements as illustrated in the prototype and sample labels in the final rule. It will also have to contain the: model's estimated annual energy consumption; estimated annual energy costs; name of the manufacturer or private labeler; model number; applicable ranges of comparability for estimated annual energy costs based on the product's diagonal screen size (according to a provided table); and placement of the product on the scale proportionate to the lowest and highest estimated annual energy costs as illustrated in the final rule.

Catalogs and Internet. Any manufacturer, distributor, retailer, or private labeler who advertises televisions on the Internet in a manner that qualifies as a catalog must display the required EnergyGuide label for each covered television. Any manufacturer, distributor, retailer, or private labeler who advertises televisions in a paper publication qualifying as a catalog will have to include either: (1) The EnergyGuide labels for products they offer; or (2) the estimated annual energy costs and the following statement conspicuously placed in the catalog: ''Your energy costs will depend on your utility rates and use. The estimated cost is based on 11 cents per kWh and 5 hours of use per day. For more information, visit (www.ftc.gov/appliances)."

Testing. Determinations of estimated annual energy consumption and the estimated annual operating (energy) costs of televisions will be based on the procedures contained in the EnergyStar Version 4.2 test, which is comprised of the ENERGY STAR Program Requirements, Product Specification for Televisions, Eligibility Criteria Version 4.2 (Adopted April 30, 2010); the Test Method (Revised Aug-2010); and the CEA Procedure for DAM Testing: For TVs, Revision 0.3 (Sept. 8, 2010). Annual energy consumption and cost estimates must be derived assuming 5 hours in on mode and 19 hours in sleep (standby) mode per day. (These ENERGY STAR requirements are incorporated by reference into 16 CFR Part 305.)

(Recordkeeping. The FTC states in the preamble that pursuant to Section 305.21 of the Appliance Labeling Rule, TV manufacturers must keep test data on file for a period of two years after the production of a covered product model has been terminated.)

(In March 2009, the FTC sought comments on whether EnergyGuide labels should be required on a range of consumer electronics, including televisions. Based on comments received, in March 2010 the agency proposed requiring the labels on televisions sold in the U.S. See ITT's Online Archives or 03/20/09 and 03/12/10 news, 09032025 and 10031220 respectively, for BP summaries.)

(FR Pub 01/06/11)