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Category — Efficiency standards

The DOE/APGA Furnace Rule Settlement: Avoiding Unintended Consequences

“In theory, higher furnace efficiency standards sound like a good thing …. However, the impact … would lead many consumers to switch from natural gas furnaces to heating alternatives that are less expensive on a first-cost basis, but are ultimately less energy efficient and result in higher consumer costs in the long term.”

Earlier this month, the American Public Gas Association (APGA) reached a mediated settlement agreement with the U.S. Department of Energy on APGA’s petition challenging regional furnace standards adopted by DOE in 2011 via a direct final rule (DFR). While some have called the settlement a “setback” and “cave-in,” the revised increased efficiency standard promises to avoid the unintended consequences that otherwise would dilute or even reverse the efficiency program’s goals.


The new standards mandate an increase in the minimum annual fuel utilization efficiency (AFUE) from 78% to 90% for natural gas furnaces installed in 30 northern states, and from 78% to 80% in the southern states (the “Furnace Rule”). As part of the settlement, DOE agreed to withdraw the gas furnace portion of the Furnace Rule and initiate a traditional notice and comment rulemaking for new gas furnace efficiency standards.

This settlement advances the shared goals of improved energy efficiency, decreased emissions, and reduced energy costs for consumers. What motivated our petition, and was set forth clearly in our briefs to the court, was a belief that this was a poorly crafted rule, enacted in a hasty manner, and without adequate public comment.

Our members, community-owned (i.e., consumer/customer-owned) not-for-profit gas utilities, readily recognized that for many American consumers the Furnace Rule, although intended to improve energy efficiency, would ultimately undermine energy efficiency, increase emissions, and increase the costs to heat their home.

Authentic Energy Efficiency Needed

While APGA supports authentic energy efficiency efforts, we will not support efficiency rules and rulemakings in name only. And, the Furnace Rule was just that— an efficiency rule in name only. [Read more →]

January 23, 2013   8 Comments