The California Energy Commission (CEC) adopted regulations last week requiring televisions smaller than 58 inches to meet higher energy-efficiency standards, with the Consumer Electronics Association (CEA) strongly protesting the decision.
The adopted rules will require California retailers to sell more energy-efficient TVs in smaller screen sizes starting in January 2011, with even more stringent limitations scheduled for 2013.
Televisions measuring 58 inches and larger, which account for less than 3 percent of the market, were temporarily omitted from the regulations as a concession to those who sell higher-end home theater systems. But they are expected to be included in the future.
The CEC said its actions should help the state save enough energy to power 864,000 single-family homes over 10 years. The commission also believes that the measures will save state consumers more than $8 billion over 10 years, which works out to nearly $20 a year per television in savings.
Those estimates were disputed by CEA charging that the CEC decision was based on “an outdated and inaccurate study by Pacific Gas & Electric [PGE],” California’s major electric power producer.
The new regulations were also supported by utility companies Edison International and Sempra Energy.
The CEC has said that its efforts to control energy consumption in other areas, such as major appliance power limits, have helped the state keep per-capita power use flat for nearly 30 years, during which time energy consumption has risen as much as 50 percent in other parts of the country.
The Consumer Electronics Association (CEA) had argued that the measure could limit innovation in next-generation TVs by forcing manufacturers to leave out new features and functionality because they would draw additional power. Meanwhile, many California consumers will be forced to purchase TVs out of state and over the Internet.
The CEA also argued that the measure was unnecessary since the federal Energy Star program has already established similar voluntary guidelines with which most manufacturers already comply. Many sets on the market today already meet the CEC 2013 mandated limits.
Jason Oxman, CEA industry affairs senior VP, said in a media conference call after the decision was approved that PGE had a “strong financial interest on imposing regulations on parties other than itself.” He added that the CE industry “and consumers will bear the burden of PGE” meeting “its energy milestones.”
The commission itself said the new rules will reduce demand on the state’s electric grid, which could avoid the need to construct additional power plants.
C. Paul Wazzan, director of LECG, which is working with CEA on this issue, said that California would lose approximately 4,037 jobs by Jan. 1, 2011, when the first set of regulations take place, and the state would lose an estimated $46.8 million in sales taxes on sets that will now be purchased out of state.
During the call CEA said that the CEC regulations would increase the cost of individual TVs by “tens or hundreds per set” and that the elimination of competition in California would increase prices at retail.
The proposal has 45 days to be reviewed, first by California’s Office of Administrative Law (OAL) and later by the state legislature.
While a lawsuit is possible if the bulk of the regulations are enacted, CEA said it would have to review the written report and stopped short of saying if it would file suit.
Aside from worries about current TVs, a major concern of CEA and the industry is new technology. As Seth Greenstein, partner of CEA’s counsel Constantine Cannon, put it, “New technology is introduced … then its performance is optimized. Today hundreds of plasma and LCD TVs comply [with energy regulations]. If these regulations were in effect [years ago], they couldn’t have been introduced.”
Greenstein cited 3D HDTV sets and new OLED displays as two formats in development that could be impacted adversely.