Supreme Court Sides Against DOE Appliance Overreach

On June 8, the U.S. Supreme Court struck down a D.C. Circuit Court ruling that would have allowed the Department of Energy (DOE) to effectively eliminate certain gas appliances from the market.

NAHB filed an amicus brief supporting the challenge in American Gas Association, et al. v. Department of Energy, et al., arguing that DOE exceeded its authority under federal law to set energy efficiency standards for consumer and commercial appliances.

Under the Energy Policy and Conservation Act (EPCA), DOE may establish efficiency standards for appliances, but it may not issue standards that make unavailable a product class with distinct “performance characteristics.” In 2023, DOE adopted standards for furnaces and commercial water heaters that could be met only by condensing technology or electric appliances.

In practice, that would eliminate gas appliances that rely on non-condensing vent systems, which are standard in most homes. Home owners who wanted to keep gas furnaces would need to install condensing vents, often requiring major and expensive renovations because those systems typically vent horizontally, unlike the vertical venting used by non-condensing systems.

NAHB’s amicus brief asked the Supreme Court to reverse the D.C. Circuit decision, stating that condensing and non-condensing vent systems are materially different and not easily interchangeable. NAHB contended that forcing home owners to switch venting systems would require substantial and costly renovations and reduce consumer choice. The brief also argued that the D.C. Circuit improperly deferred to DOE in conflict with the Supreme Court’s decision in Loper Bright Enterprises v. Raimondo.

The Supreme Court’s order sends the case back for further review. Although the litigation is ongoing, the court’s order marks an important victory for consumer choice and against regulations that raise housing costs.