While much of the regulatory focus in the water heater industry has been appropriately focused on the United States Department of Energy’s (DOE) energy conservation standards’ final rules for commercial and residential water heaters, there are still significant rules impacting our industry that are scheduled by the Department to be finalized in the coming weeks. The first is somewhat related to DOE’s existing final rule for amended energy conservation standards for residential water heaters. When the Department first proposed this rule, tankless water heaters were included, and DOE suggested they would finalize increased efficiency standards for these products that would have represented a 0.91 minimum UEF for these products in the medium draw pattern, and a 0.93 minimum UEF for these products in the high draw pattern.

However, when the residential water heater energy conservation standards’ Final Rule was issued, DOE surprisingly stripped tankless water heaters from that document, pledging to address minimum efficiencies for those products later. True to their word, DOE issued a Notice of Data Availability (NODA) focused on residential tankless water heaters this summer where they suggested, without proposing, higher minimum UEFs for these products (i.e., 0.93 UEF for products in the medium draw pattern; 0.96 UEF for products in the high draw pattern). The Department accepted comments on this proposal until late August and is scheduling to issue their Final Rule on this matter in the coming weeks. It remains unclear if DOE will adopt the efficiency levels they originally proposed, or if they will choose to adopt those identified in the NODA.

Additionally, DOE has scheduled a release of their Final Rule related to residential boilers before the end of the year. In this rulemaking, the Department had previously proposed setting a minimum Annualized Fuel Utilization Efficiency (AFUE) of 95% for these products. This would force all residential gas-fired boilers in the United States to utilize condensing technology when the rule would take effect, which would have potentially substantial impacts on homeowners, as well as contractors throughout the country.

Since both these rules impact residential products, federal law requires the changes not be effective until five years after they are finalized, likely 2029 if the Department holds to their currently proposed schedule for releasing them. This will leave industry some time to adjust if DOE does decided to act in this way.

BWC’s Government and Regulatory Affairs staff is committed to continual monitoring of these actions by the Department. If you have any questions about these actions, or any other matters pertaining to government and regulatory affairs in our industry, please do not hesitate to reach out to our team directly at BWCGovReg@bradfordwhite.com.