Federal Trade Commission Updates Labeling Rule Designed to Help Consumers Reduce Energy Costs

Following a public comment period, the Federal Trade Commission has updated its Energy Labeling Rule in order to allow consumers to more accurately compare the estimated annual energy consumption of appliances before they buy them.

The FTC’s Energy Labeling Rule, issued in 1979 under the Energy Policy and Conservation Act, requires that manufacturers attach labels to major home appliances and other consumer products that help consumers compare the energy usage and costs of competing models. The labels contain three primary disclosures for most covered products: 1) estimated annual operating cost, 2) a “comparability range” showing the highest and lowest energy consumption or efficiencies for all similar models, and 3) the product’s energy consumption or energy efficiency rating. These labels help consumers anticipate their energy costs and avoid costly surprises after a product has already been purchased.

The FTC’s May 2022 notice of proposed rulemaking sought comments on scheduled updates to the comparability ranges, which were last revised in 2017. The Commission did so under the Act, which requires updating of the labels every five years. The updates proposed would revise the comparability ranges and associated energy costs for refrigerators and freezers, dishwashers, water heaters, room air conditioners (range only), clothes washers, furnaces, televisions, and pool heaters. In addition, the Commission updates the average energy cost figures manufacturers must use to calculate a model’s estimated energy cost.

After reviewing the comments received, the FTC is now finalizing updates to the rule as proposed, with two changes. First, the Commission will wait to update the comparability rate for televisions until after the Department of Energy completes test procedure changes. Second, the Commission has set the effective date for room air conditioner labels to coincide with the 2023 production cycle, to help ensure an orderly transition for the manufacturers of these appliances.

The Commission vote approving publication of the notice in the Federal Register was 4-1, with Commission Christine S. Wilson voting no. Details on the specific EnergyGuide label changes can be found in the Federal Register notice announced today.