Court Grants Regional Standards Stay
A legal stay of the furnace regional standards has been granted by the U.S. Court of Appeals for the D.C. Circuit. As of May 1, this was the latest development in what has arguably become a legal saga. The stay deems that the Department of Energy (DOE) cannot legally enforce regional standards until the litigation is resolved.
Weeks prior to the stay, the DOE issued a statement that the rule requiring all non-weatherized gas furnaces in the northern region adhere to a minimum 90 percent AFUE standard beginning May 1 would not be immediately enforced. Despite the DOE’s instructions that the standard not be enforced, it was still on the books.
The Air-Conditioning, Heating, and Refrigeration Institute (AHRI) felt it was in the best interest of the industry to have it stayed officially and filed an unopposed emergency motion.
The manufacturer association was expecting that the motion would be granted but what it didn’t expect was the new instructions given by the court after the announcement.
“We modified our initial motion to get all of the participating parties to agree and because there was no controversy it went through as expected,” said David Calabrese, general counsel and senior vice president of policy at AHRI. “What was surprising was that the Court asked for everyone involved to provide further briefs and information for and against both the HARDI motion and the DOE settlement proposal. Frankly, we see this as unnecessary. Both of those motions were fully briefed and commented on. We don’t think it’s necessary to do anything further.”
According to Jon Melchi, director of government affairs for HARDI, the stay itself has little bearing on the lawsuit the association filed on Jan. 25, 2013. HARDI’s goal is to have the central a/c and heat pump standards rescinded as well, but so far there have not been any indications as to which way the Courts will rule.
“We view the stay as a positive development and are supportive of the Court’s decision,” said Melchi. “The Court has asked the parties involved to begin preparing additional briefs which leads me to believe they (the court) are giving serious consideration to HARDI’s motion to substitute.”
He explained that the stay provides an increased level of certainty for distributors.
“The policy statement put forth by DOE in early April still left open the possibility of enforcement if DOE was to change its mind. This stay forbids that.”
SLOW PROCESSMoving forward, AHRI is concerned that the request for more briefs to be filed is going to stretch this process even further than estimated. Although impossible to say for sure, legal and scheduling indications before the request for further input placed oral arguments somewhere in October this year with a final rule possibly issued by March of 2014. The approximately two extra months to complete a briefing schedule, however, could push oral arguments to December 2013 or January 2014. If this occurs, a final rule may not be issued until sometime possibly in June or July of next year.
“And then we have the other part of this. There are new standards for central A/C which take effect in 2015,” said Calabrese. “We could be getting up against that 2015 deadline and find ourselves in the position where we have to ask for another stay. It is feasible to think that we could be in the mid-part of next year and there’s no decision, the court’s still waiting, and we’re still in the dark about what’s happening.”
As for a reason to the delays in ruling, Calabrese pointed out two possible explanations. The first is the status of the Court. With one of the appeals courts being short a few judges, the docket is packed. This is causing some delays. The second reason looks to the complexity of this case.
“All these motions and cross motions might have the Court a little befuddled,” he explained. “I think part of its request for more briefings is so it can sort this out before a rule is made.”
NEXT BUSINESS STEPSNeither HARDI nor AHRI are advising their members to make any big changes right now. The DOE’s non-enforcement bought the industry some time, but the stay provides distributors, manufacturers, and contractors some assurance that they will not be dealing with a final regional standards rule for a while.
“Distributors should continue to be on the lookout for developments in this case,” instructed Melchi. “This motion should allow some to trend toward standard practices in regards to the stocking of heating equipment in the Northern region, although I doubt we will see a ‘return to normal’ until the case has run its course.”