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Court Rejects Trump Administration's Illegal Attempt to Allow Manufacturer to Evade Efficiency Testing

The U.S. District Court for the Southern District of New York declared the rollback “arbitrary and capricious.” The ruling said the agency’s unlawful actions were designed to singularly benefit JCI at the expense of American consumers.

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On behalf of the Natural Resources Defense Council (NRDC), Democracy Forward Foundation sued the U.S. Department of Energy for rolling back parts of a widely supported energy efficiency rule that halted the sale of replacement air conditioners that were skirting stricter energy-saving requirements.

The Trump Administration’s Department of Energy recently stayed two provisions of a January 2017 rule titled “Test Procedures for Central Air Conditioners and Heat Pumps,” which had made critical updates designed to modernize efficiency test procedures. The Trump Administration rolled back sections of the rule that closed a loophole allowing certain replacement air conditioners to avoid meeting stricter energy efficiency regulations.

DOE’s stay reopened the loophole for manufacturer abuse to sell replacement units without having to meet stricter efficiency requirements, which would result in higher utility bills for consumers and increased pollution from power plants.

The stay is unlawful and violated the Administrative Procedure Act in multiple ways. First, the effective date of the Test Procedures Rule had already passed when DOE issued the stay, and § 705 does not authorize an agency to postpone the effectiveness of a rule after it has gone into effect.  The delay was also arbitrary and capricious, in part because DOE’s one-sentence explanation was insufficient to justify the stay.

The delay also harms consumers and the environment and disadvantages the vast majority of American manufacturers who complied with the rule.

The loophole closure had been supported by NRDC, the American Council for an Energy-Efficient Economy, and the Appliance Standards Awareness Project, as well as the Air-Conditioning, Heating, and Refrigeration Institute, an industry trade group whose members produce more than 90 percent of air conditioners and heat pumps sold domestically.

The suit, which was filed in the U.S. District Court for the Southern District of New York, seeks to reinstate the full Test Procedures Rule and close the loophole.

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Jeffrey Dubner

Managing Senior Counsel

Litigating challenges to unlawful actions, abuses of power, and threats to democracy on behalf of those who are harmed.

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Aman George

Counsel & Legal Policy Director

Challenging unlawful actions and abuses of power related to the environment, healthcare, and good governance.

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