cecseal-modBack in March, we reported on the California Energy Commission’s proposal to set a cap on the maximum active mode power usage (watts) for TV’s. All units above the maximum would be banned for sale in California—this would preclude the vast majority of Plasma, DLP, and Rear-projection TV’s.

With battle lines drawn, the CEC held a hearing to vet public opinion. On one side were the Consumer Electronic Association (CEA), the Custom Electronic Design & Installation Association (CEDIA), and Panasonic; on the other, LCD TV manufacturer Vizio, the LCD TV Association, the Natural Resources Defense Council, Pacific Gas & Electric, Southern California Edison, Environment California, and the United Defense Fund, among others. The legislation would favor LCD’s and kill Plasmas, so you can draw your own conclusions as to the “Yays” and “Nays.”

According to the “Nays,” it was a drubbing. Peter Fannon, Vice President of Corporate & Government Affairs, Panasonic, claimed the CEC was dismissive, even rude, and their decision seemed made—they were “inclined to regulate,” according to Fannon. I also spoke with Doug Johnson, Senior Director of Technology Policy, at the Consumer Electronics Association (CEA). Both felt that government regulation was unnecessary, given the success of Energy Star (a voluntary program enjoying the full cooperation of industry).

A provision in the California Public Resources Code states that new energy efficiency standards must “not result in any added total costs to the consumer over the designed life of the television.” This is a major point of dispute in the ongoing regulation battle.

According to Bruce Berkoff, Chairman, LCD TV Association, “the average Californian should not see a cost premium for compliant TVs compared to today’s non-compliant TVs. They will however benefit from dozens to hundreds of dollars in energy cost savings over their TV’s lifetime, thus making the proposed standard extremely cost-effective for the state of California.”

In sum, the CEC predicts 8.1 billion in “direct energy cost savings.” But the opposition disputes these figures. The CEA says the 8.1 figure is closer to 4, along with a plethora of purported mathematical errors on the part of the CEC. In addition, the CEC ignores the side effects. The Californians for Smart Energy (a loose coalition of businesses and trade groups) predicts the following:

• 4,600 jobs lost (tied to TV sales, distribution and installation)
• $50 million a year in lost tax revenues.

The CEC claims the legislation won’t kill jobs or add significant costs to small businesses. According to its report, the proposal won’t, “decrease the ability of in state businesses to compete with out of state businesses.” But this is based on a shaky assumption—that consumers base purchases on energy efficiency. This is clearly false. Many prefer Plasma TV’s for aesthetic reasons, and a ban will send their business elsewhere—either online or out-of-state.

Ultimately, the purported savings are irrelevant. The crucial issue is consumer choice, or lack thereof. Sarah Szabo of the CEA opined that, “the idea of government restricting the main source of entertainment in my home is more than a bit disturbing.”

In a letter to the CEC, Best Buy claimed that “mandating such artificial and unnecessary state energy use…limits consumer choice, increases product costs significantly, drives consumers to out-of-state retailers and on-line sellers, and leads to unfair competition in the marketplace.” On average, Energy Star TVs cost $167.05 more than their non-certified brethren, notwithstanding potential long-term energy savings. If consumers value energy efficiency (as defined by Energy Star), they can choose appropriately. The key word is choice.

The public comment period lasts from September 18 through November 2, 2009. By November 4th, the CEC will act—and the result seems preordained. Here's hoping the commission sees the proverbial light.