1. EISA 2007 Energy Independence and Security Act 2007 And New Small Motor regulation A Motor Perspective December 2010

2. Motors | Automation | Energy | Coatings NEMA Efforts NEMA publishes a summary of the areas of impact for the Energy legislation on the Electrical industries. http://www.nema.org/gov/energy/Energy- Legislation.cfm http://www.nema.org/gov/energy/Energy- Legislation.cfm 2005 (Page 4 is motors) 2007 bills (See appendix II) Original EPAct 10 CFR Part 431 http://ecfr.gpoaccess.gov/cgi/t/text/text- idx?c=ecfr;sid=305e4d871e37ab4506f0b66ea184e93e;rgn=div5;view=text;node=10%3A3.0.1.4.17;idno=10;cc=ecfr http://ecfr.gpoaccess.gov/cgi/t/text/text- idx?c=ecfr;sid=305e4d871e37ab4506f0b66ea184e93e;rgn=div5;view=text;node=10%3A3.0.1.4.17;idno=10;cc=ecfr

3. Motors | Automation | Energy | Coatings Energy Legislation Summary Original Legislation – EPAct 1992 The 2005 bill made the purchase of NEMA Premium motors mandatory for government buildings in an attempt to show leadership in saving energy. The 2007 bill raised the level of all product covered in the original bill to the NEMA Premium levels with the exception of Fire Pump motors (Due to low run hours) E ffective December 19, 2010 The 2007 bill also tried to plug the holes of the original bill by expanding coverage All ratings that are covered by the expanded coverage will only be require to meet NEMA Table 12-11 which is the Energy Efficient (Old EPAct) levels.

4. Motors | Automation | Energy | Coatings 2007 EISA Enhancements General purpose electric motor (subtype I) – any electric motor incorporating the design elements of a general purpose… Previously covered products (Including XP) increase to NEMA Premium ® (except fire pump motors) Electric motor (subtype II) increase to NEMA MG1 Table 12-11 that are configured as: U-Frame motor Design C motor Close-coupled pump motor Footless motor Vertical solid shaft normal thrust motor (tested in a horizontal configuration 8-pole motor (900 rpm) Polyphase motor with voltage no more than 600 volts (other than 230 or 460 volts which moved to NEMA Premium) LV Design B (Not A or C) Motors to 201HP - 500HP

5. Motors | Automation | Energy | Coatings Is My Motor Covered??? Brake Motors - Maybe Appendix A to Subpart B of Part 431—Policy Statement for Electric Motors Covered Under the Energy Policy and Conservation Act provides the following guidance. According to the examples of many common features or motor modifications that illustrate how the EPCA definitions and DOE guidelines would be applied to motor categories: General Purpose; Definite Purpose; and Special Purpose, a motor with an integral brake design that is factory built within the motor is considered a special purpose motor and therefore not covered. (Otherwise, a motor with a brake attached (removable) is still considered a general purpose motor and therefore covered.) Multi-Voltage like 208-230/460 - Yes Must meet table 12-11(EPAct) at 208V and Table 12-12 (NEMA Premium) at 230 and 460V. Example from 10 CFR Part 431 “ For example, a motor that is rated at 220 volts should operate successfully on 230 volts, since 220 +.10(220) = 242 volts. A 208 volt motor, however, would not be expected to operate successfully on 230 volts, since 208 +.10(208) = 228.8 volts.”

6. Motors | Automation | Energy | Coatings Is My Motor Covered??? Special Customer defined Flange: - No While NEMA C & D as well as IEC equivalents are covered, Special Customer flanges are not covered and the motors are not required to meet EPAct (or EISA) What about Verticals?? - Some Hollow Shaft – Not covered only Solid Shaft added by EISA P-Base solid shaft (HP, LP..)– Only covered if “Normal Thrust” Special Shaft motors (Typically TZ, TCZ, TDZ,TY, LPZ...) - No These motors are not considered “General Purpose and are not covered. 201HP-500HP Design A or Medium Voltage – No MV not covered in General Purpose definition. Only NEMA Design B is covered on 201-500HP

7. Motors | Automation | Energy | Coatings Is My Motor Covered??? “Inverter Duty” – Motors listed for VFD capability Yes if – the motor is also suitable for general purpose use on 60Hz sine wave power Typical example is a Des A or B motor that can start across the line, but has a MG1 Part 31 VFD capable insulation and is labeled “Inverter Duty” No if – the motor has a special winding optimized for VFD service and can not be used across the line. i.e. Vector Duty motors that may have excessive staring current or insufficient starting torque when started across the line

8. Motors | Automation | Energy | Coatings What about Motors for Export WEG can manufacture and import motors that do not comply with the regulation, if they are specifically marked as: “Export only, Not for installation in the US” Orders must specifically reference this requirement, and these will be entered on the plants requiring this note on the motor and Packaging No special tracking of the motors is required to prove they were exported, but penalties will be severe if these motors are found installed in the US

9. Motors | Automation | Energy | Coatings Penalties What is the penalty based on? Improper labeling i.e. Lack of CC# or Efficiency Not meeting efficiency level Publishing catalog without required info (CC#) Failure to provide samples for Gov’t test-No Charge Failure to allow access to Documents Penalty $110/violation/day Penalty is at discretion of DOE and may be reduced or waived if DOE chooses based on evaluation.

10. Motors | Automation | Energy | Coatings What next Working with advocacy groups such as ACEEE (American Council for and Energy Efficient Economy) and ASE (Alliance to Save Energy) to promote Energy Efficiency incentives and programs. Two Energy Bills currently in Congress contain incentive programs WEG and NEMA have promoted to encourage the early switch to NEMA Premium and the replacement rather than repair of older inefficient motors. -These bills do not look like they will pass New Efficient technology bill in congress $125/HP PM, ECM.. DOE reevaluating Efficiency levels for further increase Energy advocates pushing to move exceptions to NEMA Premium What can we do? You and customers can contact representatives to support the Replace Vs Repair legislation if it still exists. Inventory installed base at customers facilities to be ready to take advantage of incentives or to just make good repair Vs replace decisions in the future.

11. Motors | Automation | Energy | Coatings Small AC Motor Efficiency Regulation On Feb 28, 2010 the DOE has also mandated efficiencies of General Purpose Small motors. This regulation will go into effect 2015 Covered motors are defined as: 1/4 to 3HP ODP 3-phase, and single phase CSCR and CSIR 2 Digit Frames 42, 48, 56 and IEC equivalent Issues NEMA sees- Size change impact OEM’s Size change impact MRO replacements Setting Efficiency level where no Rating /Frame standard exists Questionable data in baseline study Overestimate of operating hours for justification http://www1.eere.energy.gov/buildings/appliance_standards/commer cial/small_electric_motors.html http://www1.eere.energy.gov/buildings/appliance_standards/commer cial/small_electric_motors.html

12. Motors | Automation | Energy | Coatings Global Regulations Efficiency LevelsEfficiency Classes IEC 60034-30 Global 2008 Testing Standard IEC 60034-2-1 2008 MEPS Adopted in These Countries StandardIE1AllBrazil China Costa Rica Israel Taiwan High EfficiencyIE2Mexico Australia New Zealand Brazil 2009 China 2011 Europe 6/2011 Korea 2008 Premium EfficiencyIE3USA 2011 Canada 2011 Europe Jan 2015 7.5kW+ Europe Jan 2017.75kW+ Above-Premium Efficiency IE4None

13. Motors | Automation | Energy | Coatings Is WEG Ready? As one of the largest industrial motor manufacturers in the world, WEG is ready and pushing for early adoption of NEMA Premium or greater motors by customers to save energy – WEG has a complete line of NEMA Premium products today and has the capacity to meet the 2010 requirements today. WEG is currently introducing a new low voltage motor platform (W22) that was developed to optimize the designs around the NEMA Premium motors, and offer even higher efficiencies in the future. WEG’s North American manufacturing facilities are currently being optimized for the production of NEMA Premium motors. WEG EISA Cert # is the same as EPAct CC# 029A

14. Motors | Automation | Energy | Coatings Are You Our Customers Ready Deadline is December 19, 2010 Your drawings have part #’s for EISA compliant products. Third party certifications on your products include EISA compliant motors. You have a plan to convert inventory. (You can still sell Pre-EISA motors if they were produced or imported prior to 12/19/2010, but some customers may not want them.) You have completed product performance testing with EISA compliant products. Have you partnered with a motor manufacturer that understands the 2010 EISA requirements and is prepared to help you get ready? If you are seeing this presentation you have found one. WEG – Transforming Energy into solutions

15. Motors | Automation | Energy | Coatings Thank You Dale Basso – Motors Manager WEG Electric Corp Vice Chairman NEMA Motor / Generator Section Phone: (678)534-4667 E-mail: dbasso@weg.net