Republican-led states challenge Biden home energy efficiency standards

By Nate Raymond

Jan 2 (Reuters) - Fifteen Republican-led states and a national home builders group on Thursday filed a lawsuit challenging new minimum energy standards for federally funded housing set by outgoing Democratic President Joe Biden's administration.

In a lawsuit filed in federal court in Tyler, Texas, the states and the National Association of Home Builders argued the standards were adopted pursuant to an unconstitutional law and without regard to how they would affect housing affordability.

The U.S. Department of Housing and Urban Development and the U.S. Department of Agriculture, which adopted the standards in April as part of a broader administration push to reduce carbon emissions that contribute to climate change, did not respond to requests for comment.

Utah Attorney General Sean Reyes, whose state is co-leading the lawsuit with Texas, in a statement said they were "urgently seeking a roll-back on the radical environmental agendas that, if not changed, will devastate the American dream of home ownership."

The standards apply to new affordable housing construction built with federal financing provided by HUD or the USDA and cover insulation, windows, lighting and heating and cooling systems, among other energy-relates aspects of a home.

In announcing the new standards, the agencies said they would result in energy efficiency improvements of 37% that would cut energy costs by more than $950 per year and would allow families to save almost $25,000 over a 30-year mortgage.

But in Tuesday's lawsuit, Republican state attorneys general led by Sean Reyes of Utah and Ken Paxton of Texas argued that the standards would in fact reduce the affordability and availability of low-income housing by adding up to $31,000 to the price of a new home.

The standards were adopted pursuant to Section 109 of the Cranston-Gonzalez National Affordable Housing Act of 1990, which established procedures for the two departments to set minimum energy standards and jointly determine the feasibility of adopting building codes set by two building code organizations.

The lawsuit argued that law ran afoul of the U.S. Constitution and the so-called non-delegation doctrine by delegating authority to the International Code Council and the American Society of Heating, Refrigerating, and Air-Conditioning Engineers to update federal energy efficiency standards.

The states argued that even if those groups' role was permissible, HUD and USDA did not comply with statutory requirements when adopting the standards and failed to grapple with their real-world cost effects.

The case is State of Utah v. Todman, U.S. District Court for the Eastern District of Texas, No. 6:25-cv-00001.

For Utah: Stanford Purser of the Office of the Utah Attorney General

For Texas: Ryan Kercher of the Office of the Attorney General of Texas

(Reporting by Nate Raymond in Boston)

((Nate.Raymond@thomsonreuters.com and Twitter @nateraymond; 347-243-6917; Reuters Messaging: nate.raymond.thomsonreuters.com@reuters.net))