The U.S. Supreme Court has decided to reverse and send back a previous ruling regarding the energy efficiency regulations for gas furnaces and water heaters set by former President Joe Biden’s administration.
The American Gas Association, along with other parties, filed a lawsuit in the U.S. Court of Appeals in D.C. over an April ruling concerning these regulations. This lawsuit originated from a rule put forth by the Department of Energy (DOE) during the Biden era that mandated a 95% efficiency level for natural gas furnaces and commercial water heaters, under the Energy Policy and Conservation Act (EPCA). A lower court initially supported these energy efficiency policies from the Biden administration, but the Supreme Court’s decision has now changed that, nullifying the earlier ruling from November 2025, which gives President Donald Trump’s administration the opportunity to challenge these standards.
The attorney general’s brief argued in April that the standards established during Biden’s tenure would, in effect, phase out non-condensing gas furnaces and water heaters from the market. The DOE noted that standard non-condensing models typically achieve around 80% efficiency, mainly losing about 20% through exhaust, whereas condensing units can reach efficiencies of 90-95%.
The EPCA provisions make it explicit that the DOE cannot limit consumer options based on specific “functional provisions,” which encompass certain “performance characteristics.” The attorney general’s brief emphasized that the previous ruling had an overly restrictive interpretation of what a “performance characteristic” truly is. The new government administration seems to agree and has requested the Supreme Court to annul the invalidated ruling.
The U.S. Supreme Court has now ordered the D.C. Circuit to revisit the regulations, keeping in mind the Trump administration’s proposed changes to them. The AGA has previously indicated that the EPCA prevents the government from eliminating appliances based on their performance standards, emphasizing that this removal would necessitate significant renovations in homes.
Industry representatives contended that a ruling in 2025, which upheld the Biden-era standards, was flawed and ran afoul of established regulations. They highlighted that the Supreme Court’s previous ruling necessitated independent evaluation by the government regarding agency decisions. In their appeal, gas industry groups argued that the earlier ruling reinstated outdated approaches.
On the flip side, advocacy groups and states that backed the Biden rules believed the 2025 decision was justified and did not warrant Supreme Court intervention, arguing it was purely based on factual matters.
