In American Gas Association v. U.S. Department of Energy, a divided panel of the U.S. Court of Appeals for the D.C. Circuit rejected a legal challenge to a regulation adopting energy efficiency standards for natural gas-powered consumer furnaces and commercial water heaters that effectively bans non-condensing units from the market. This regulation had been adopted in 2023, and the court heard oral argument in November 2024, but only released its opinion in November of this year.
According to the panel opinion, written by Judge Wilkins and joined by Judge Pillard, the regulation did not exceed DOE's authority under the Energy Policy and Conservation Act (EPCA) and was not arbitrary and capricious. Judge Rao dissented (and, in my view, had the better of the argument).
Here is how Judge Rao describes the issues and why the DOE rule should have been held unlawful.
