Peter Mayberry, contributing editor05.13.16
As part of a “systematic review” of all current rules and guides under its purview, the U.S. Federal Trade Commission (FTC) is calling for comment on the overall costs, benefits, necessity and regulatory/economic impacts of the commission’s Trade Regulation Rule Concerning the Labeling and Advertising of Home Insulation, which is commonly referred to as the “R-value Rule.”
This is important to members of the nonwovens industry who are involved in the manufacture and/or supply of any sort of home insulation product because, as FTC notes, the R-value Rule covers all products that are “mainly used to slow down heat flow.” The current rule, in fact, covers most types and forms of insulation marketed for use in residential structures, even if those products aren’t directly cited under the current R-value Rule.
Fiberglass was first patented in the U.S. by Owens Corning in 1936 and ushered in the modern era of home insulation, and there has been a decades-long debate as to whether the fiberglass industry is actually a subset of the nonwovens industry. The pro side of the debate being—well, fiberglass is made up of fibers that aren’t woven together so, of course, it’s a nonwoven – with the con side being, fiberglass isn’t a nonwoven, fiberglass is fiberglass.
Either way, there are a plethora of products other than fiberglass that are used in the home insulation market these days and all of them are potentially impacted by FTC’s proposal.
At Issue
As FTC sees it, home insulation falls into two basic categories: “mass” and “reflective.” Mass insulations reduce heat transfer by conduction (through the insulation’s mass), convection (air movement within, and through, the air spaces inside the insulation) and radiation. Reflective insulations (primarily aluminum foils) reduce heat transfer when installed facing an airspace. Within these basic categories, home insulation is sold in various types or materials (e.g., fiberglass, cellulose, polyurethane, aluminum foil) and forms (e.g., batt, dry-applied loose-fill, spray-applied, board stock, multi-sheet reflective).
The current R-value Rule applies to home insulation manufacturers, professional installers, retailers who sell insulation to consumers for do-it-yourself installation, and new home sellers, including sellers of manufactured housing. It also applies to testing laboratories that conduct R-value tests for home insulation manufacturers or other sellers who base their R-value claims on these test results.
As noted in the announcement for this action, reliable value ratings for home insulation products were not available from the dawn of the modern industry until FTC first adopted the R-value Rule (16 CFR 460) in 1979 in an effort “to address the failure of the home insulation marketplace to provide essential pre-purchase information to consumers, primarily an insulation product’s ‘R-value.’”
R-value rates reflect a product’s ability to restrict heat flow which, in turn, reduces energy costs: the higher the R-value, the better the product’s insulating ability. But FTC notes that R-value ratings vary among different types and forms of home insulations, and can even vary among products which are the same type and form.
The first version of the current R-value Rule was adopted, according to FTC, in response to a variety of unfair or deceptive actions by the insulation industry. Specifically, the commission found that many sellers either failed to disclose R-values or exaggerated R-value disclosures. Others failed to inform consumers about R-value’s meaning and importance; exaggerated fuel bill savings or didn’t disclose that savings vary depending on consumers’ particular circumstances. FTC also asserts that some industry members have falsely claimed that consumers who purchase certain types of insulation would qualify for special tax credits because their products had been “certified” or otherwise “favored” by Federal agencies.
To address these practices, the current R-value Rule provides substantiation and disclosure requirements for insulation products used in the residential market. Specifically, FTC notes that the current Rule requires insulation sellers to disclose the insulation product’s R-value and related information for their products based on uniform, industry-adopted test procedures which enable consumers to evaluate the performance and cost effectiveness of competing insulation products. The current rule also requires manufacturers to disclose R-value and related information (e.g., thickness, coverage area per package) on package labels and manufacturer fact sheets.
R-value disclosures must be derived from tests conducted according to one of four specified American Society of Testing and Materials (ASTM) test procedures that measure thermal performance. For mass insulations, the required tests include ASTM C-177, C-236, C-518 and C-976.
Regulatory Review Program
With its April 6 announcement FTC is initiating a new review and seeks public comments on issues related to the economic impact of—and continuing need for – the R-value Rule, as well as the rule’s benefits to consumers and any burdens it places on industry members who are subject to its requirements.
FTC is especially interested in comments that address general regulatory review questions such as: 1) Is there a continuing need for the Rule? Why or why not? 2) What are the Rule’s benefits and costs to Consumers: What benefits has the Rule provided to consumers? Does the Rule impose any significant costs on consumers? 3) What benefits, if any, has the Rule provided to businesses? Does the Rule impose any significant costs, including costs of compliance, on businesses, including small businesses? 4) What modifications, if any, could be made to increase the benefits and/or reduce the Rule’s costs? How would these modifications affect the costs and benefits of the Rule for consumers? How would these modifications affect the costs and benefits of the rule for businesses, particularly small businesses?
Other specific issues of FTC interest focus on the impact the rule has had on truthful flow of information to consumers, whether there are any unnecessary provisions in the rule, and whether the rule needs to be broadened to cover products that should be subject to its provisions but currently aren’t.
Additionally, FTC is interested in comments related to any technological or economic changes that should be taken into account for current or impending changes in technology or economic conditions, as well as any overlap or conflict the rule has with other Federal, State or local laws or regulations.
With regard to specific questions related to R-Values, FTC is interested in comments on whether: 1) the Rule should be amended to require ASTM 1303 (“Standard Test Method for Predicting Long-Term Thermal Resistance of Closed-Cell Foam Insulation”) or a different test? 2) should the Commission consider changing, adding, or removing affirmative disclosures required by the Rule for labeling and advertising related to mass insulation, reflective insulation, or radiant barriers? 3) Given the significant increase in the use of foam insulation products since the last Rule review in 2005, should FTC consider any Rule changes to help prevent deception in the marketing of such products, or reduce unnecessary burdens on sellers? and 4) Should the Commission consider any changes to the testing provisions in the Rule? Are there any tests currently referenced in the Rule that should be removed?
Written and electronic comments can be filed, but for FTC to consider a comment it must be received no later than June 6, 2016, and must cite “16 CFR part 460—R-value Rule Review, File No. R811001.”
As FTC notes, all comments will be placed, in their entirety—including your name and your state — on the Internet at www.ftc.gov/os/publiccomments.shtm. If you want confidential treatment for your comment you must file it in paper form, with a request for confidential treatment. Keep in mind, however, that your comment will be kept confidential only if the FTC General Counsel grants your request in accordance with the law and the public interest.
Electronic comments should be sent to www.ftcpublic.commentworks.com/ftc/r-valuereview or www.regulations.gov under FTC File No. R811001.
Paper comments must reference “16 CFR part 460—R-value Rule Review, File No. R811001” on the envelope, and be mailed to: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 (Annex B), Washington, DC 20580. Comments may also be hand- or courier-delivered to FTC Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, suite 5610 (Annex B), Washington, DC 20024.
If possible, FTC requests that paper comments to the Commission be delivered by either courier or overnight service because USPS mail addressed to the Commission is subject to “heightened security screening” (i.e. x-ray), which delays delivery and can damage paper.
For additional information, please contact Hampton Newsome, attorney, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission at 202.326.2889 or by mail addressed to his attention at 600 Pennsylvania Ave. NW., Washington, DC 20580.
This is important to members of the nonwovens industry who are involved in the manufacture and/or supply of any sort of home insulation product because, as FTC notes, the R-value Rule covers all products that are “mainly used to slow down heat flow.” The current rule, in fact, covers most types and forms of insulation marketed for use in residential structures, even if those products aren’t directly cited under the current R-value Rule.
Fiberglass was first patented in the U.S. by Owens Corning in 1936 and ushered in the modern era of home insulation, and there has been a decades-long debate as to whether the fiberglass industry is actually a subset of the nonwovens industry. The pro side of the debate being—well, fiberglass is made up of fibers that aren’t woven together so, of course, it’s a nonwoven – with the con side being, fiberglass isn’t a nonwoven, fiberglass is fiberglass.
Either way, there are a plethora of products other than fiberglass that are used in the home insulation market these days and all of them are potentially impacted by FTC’s proposal.
At Issue
As FTC sees it, home insulation falls into two basic categories: “mass” and “reflective.” Mass insulations reduce heat transfer by conduction (through the insulation’s mass), convection (air movement within, and through, the air spaces inside the insulation) and radiation. Reflective insulations (primarily aluminum foils) reduce heat transfer when installed facing an airspace. Within these basic categories, home insulation is sold in various types or materials (e.g., fiberglass, cellulose, polyurethane, aluminum foil) and forms (e.g., batt, dry-applied loose-fill, spray-applied, board stock, multi-sheet reflective).
The current R-value Rule applies to home insulation manufacturers, professional installers, retailers who sell insulation to consumers for do-it-yourself installation, and new home sellers, including sellers of manufactured housing. It also applies to testing laboratories that conduct R-value tests for home insulation manufacturers or other sellers who base their R-value claims on these test results.
As noted in the announcement for this action, reliable value ratings for home insulation products were not available from the dawn of the modern industry until FTC first adopted the R-value Rule (16 CFR 460) in 1979 in an effort “to address the failure of the home insulation marketplace to provide essential pre-purchase information to consumers, primarily an insulation product’s ‘R-value.’”
R-value rates reflect a product’s ability to restrict heat flow which, in turn, reduces energy costs: the higher the R-value, the better the product’s insulating ability. But FTC notes that R-value ratings vary among different types and forms of home insulations, and can even vary among products which are the same type and form.
The first version of the current R-value Rule was adopted, according to FTC, in response to a variety of unfair or deceptive actions by the insulation industry. Specifically, the commission found that many sellers either failed to disclose R-values or exaggerated R-value disclosures. Others failed to inform consumers about R-value’s meaning and importance; exaggerated fuel bill savings or didn’t disclose that savings vary depending on consumers’ particular circumstances. FTC also asserts that some industry members have falsely claimed that consumers who purchase certain types of insulation would qualify for special tax credits because their products had been “certified” or otherwise “favored” by Federal agencies.
To address these practices, the current R-value Rule provides substantiation and disclosure requirements for insulation products used in the residential market. Specifically, FTC notes that the current Rule requires insulation sellers to disclose the insulation product’s R-value and related information for their products based on uniform, industry-adopted test procedures which enable consumers to evaluate the performance and cost effectiveness of competing insulation products. The current rule also requires manufacturers to disclose R-value and related information (e.g., thickness, coverage area per package) on package labels and manufacturer fact sheets.
R-value disclosures must be derived from tests conducted according to one of four specified American Society of Testing and Materials (ASTM) test procedures that measure thermal performance. For mass insulations, the required tests include ASTM C-177, C-236, C-518 and C-976.
Regulatory Review Program
With its April 6 announcement FTC is initiating a new review and seeks public comments on issues related to the economic impact of—and continuing need for – the R-value Rule, as well as the rule’s benefits to consumers and any burdens it places on industry members who are subject to its requirements.
FTC is especially interested in comments that address general regulatory review questions such as: 1) Is there a continuing need for the Rule? Why or why not? 2) What are the Rule’s benefits and costs to Consumers: What benefits has the Rule provided to consumers? Does the Rule impose any significant costs on consumers? 3) What benefits, if any, has the Rule provided to businesses? Does the Rule impose any significant costs, including costs of compliance, on businesses, including small businesses? 4) What modifications, if any, could be made to increase the benefits and/or reduce the Rule’s costs? How would these modifications affect the costs and benefits of the Rule for consumers? How would these modifications affect the costs and benefits of the rule for businesses, particularly small businesses?
Other specific issues of FTC interest focus on the impact the rule has had on truthful flow of information to consumers, whether there are any unnecessary provisions in the rule, and whether the rule needs to be broadened to cover products that should be subject to its provisions but currently aren’t.
Additionally, FTC is interested in comments related to any technological or economic changes that should be taken into account for current or impending changes in technology or economic conditions, as well as any overlap or conflict the rule has with other Federal, State or local laws or regulations.
With regard to specific questions related to R-Values, FTC is interested in comments on whether: 1) the Rule should be amended to require ASTM 1303 (“Standard Test Method for Predicting Long-Term Thermal Resistance of Closed-Cell Foam Insulation”) or a different test? 2) should the Commission consider changing, adding, or removing affirmative disclosures required by the Rule for labeling and advertising related to mass insulation, reflective insulation, or radiant barriers? 3) Given the significant increase in the use of foam insulation products since the last Rule review in 2005, should FTC consider any Rule changes to help prevent deception in the marketing of such products, or reduce unnecessary burdens on sellers? and 4) Should the Commission consider any changes to the testing provisions in the Rule? Are there any tests currently referenced in the Rule that should be removed?
Written and electronic comments can be filed, but for FTC to consider a comment it must be received no later than June 6, 2016, and must cite “16 CFR part 460—R-value Rule Review, File No. R811001.”
As FTC notes, all comments will be placed, in their entirety—including your name and your state — on the Internet at www.ftc.gov/os/publiccomments.shtm. If you want confidential treatment for your comment you must file it in paper form, with a request for confidential treatment. Keep in mind, however, that your comment will be kept confidential only if the FTC General Counsel grants your request in accordance with the law and the public interest.
Electronic comments should be sent to www.ftcpublic.commentworks.com/ftc/r-valuereview or www.regulations.gov under FTC File No. R811001.
Paper comments must reference “16 CFR part 460—R-value Rule Review, File No. R811001” on the envelope, and be mailed to: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 (Annex B), Washington, DC 20580. Comments may also be hand- or courier-delivered to FTC Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, suite 5610 (Annex B), Washington, DC 20024.
If possible, FTC requests that paper comments to the Commission be delivered by either courier or overnight service because USPS mail addressed to the Commission is subject to “heightened security screening” (i.e. x-ray), which delays delivery and can damage paper.
For additional information, please contact Hampton Newsome, attorney, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission at 202.326.2889 or by mail addressed to his attention at 600 Pennsylvania Ave. NW., Washington, DC 20580.
