Court Upholds DOE Ban on Non-Condensing Water Heaters and Furnaces

water heater

USA: A federal appellate court ruled Tuesday in a 2-1 decision that the U.S. Department of Energy’s (DOE) rules, which effectively phase out the sale of non-condensing gas commercial water heaters and consumer furnaces in favor of more efficient condensing models, can move forward.

These DOE regulations, first proposed over a decade ago and finalized in 2023 (water heaters) and 2024 (furnaces), set a 95% efficiency standard for gas-fired commercial water heaters and consumer furnaces. The DOE estimates that the new standards could save consumers nearly US$25 billion in energy costs over 30 years. The rules are grounded in the Energy Policy and Conservation Act of 1975, which requires the department to establish appliance efficiency standards. The last updates to furnace standards were in 2007, and residential water heater standards were last updated in 2010.

Traditional non-condensing water heaters and furnaces achieve roughly 80% efficiency, with the remaining energy lost primarily through unpowered heat vented via vertical chimneys. In contrast, condensing appliances typically reach 90%-95% efficiency by capturing and converting excess heat into additional heating. Residual cool air is expelled through a horizontal vent aided by a fan, while condensate water is drained away, enabling significantly higher energy utilization.

Source: U.S. Department of Energy