92% AFUE Furnaces…Here We Go Again!


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About a year ago our industry accomplished a noteworthy victory a federal court accepted a settlement agreement that vacated and remanded the 2011 rules setting regional standards for residential gas furnaces. We were all excited to promote high efficient furnaces, but we knew that making them mandatory in every replacement instance would be a mistake.

That same settlement did allow regional standards for split-system and single package central air conditioners to go into effect this past January. There was not a drop dead date for 13 SEER units left stranded outside the North region but an 18 month installation grace period to use up inventory that was manufactured prior to the start of 2015.

Under the terms of the settlement the court ordered the DOE to convene industry stakeholders to negotiate an enforcement plan for the regional standards. A special working group of contractors, manufacturers, distributors, energy efficiency advocates, and utilities spent three months negotiating a plan that was submitted to the DOE in October of 2014. This enforcement plan will be released as a proposed rule for comment sometime in the near future. This should clear up the confusion about how the standard will be enforced.

The DOE was also given two years to finish a “do over” on the standards for residential natural gas furnaces under the terms of the court settlement. The DOE wasted no time in issuing a new proposal that was significantly more stringent than their 90%Northern region/80% South/Southwestern region standard in the 2011 rule. The new standard proposed in February set a minimum AFUE standard of 92% for the entire country along with an electrical standard of a maximum electrical usage of 8.5 watts in both standby mode and power off mode.

Since we have had some time to get over the initial shock there is no point in being shy about it. We need to get our heads in the game, come together as an industry, figure out what we need to do about it, and then go and do it.

The Problem With a 92% Furnace Standard
The issue with the proposed standard is pretty obvious: it eliminates the manufacture or import of condensing furnaces after 2021. This is likely to cause hardship on some homeowners when replacing a non-condensing gas furnace with a condensing one. This is especially true in townhomes or row houses where you may not have access to an exterior wall which will increase the cost of venting dramatically. There may even be instances where it is practically impossible to install according to manufacturer’s installation instruction. Even the DOE recognizes in their economic analysis that there will be installations where the payback from lower utility bills will not cover the additional costs over the life of the equipment.

Another issue with the standard is the thought process behind it. The proposed minimum standard furnace does not currently exist. There are furnaces that meet the AFUE minimum but not the electrical requirements. There are furnaces that meet the electrical requirements but are much more efficient than the minimum AFUE standards. Why propose a standard that requires a new model to be created as well? Would it not be more sensible to create a standard that meets an energy efficiency minimum on a furnace that is already readily available?

With the abolition of the 80% furnace there will likely be an increase in the repair of furnaces that have passed their useful life. The increased cost of installing a condensing furnace will tilt a homeowner towards replacing parts instead of upgrading. This will cause an increase in utility consumption because a furnace that should have been replaced with all new components will now be running longer on the old ones. Older components that are less efficient than their newer counterparts use more energy and can cause premature failure in other components.

A standard that encourages the repair of outdated and inefficient equipment undermines the federal government’s policy goals of transforming the market to higher energy efficiency. It may also push owners to switch heating fuel sources. When the switch is to a more efficient system of heating this will be what the policy is striving for. However, when the switch is to something less expensive this will usually be to something less efficient and will be defeating what the policy is trying to accomplish.

What We Need to Do
You have heard it before and it still holds true now, if we sit on the sidelines we will be left out of the game. The ACCA is working for us, but it is not enough. We need to raise our voices and tell the DOE that this proposed rule as it stands is bad for everyone.

Nobody wants to go through another long drawn out legal challenge that creates uncertainty and confusion. ACCA will help make it easier for our voices to be heard. And if we get enough voices singing in chorus the Department of Energy will have to listen to our concerns. And when they really understand those concerns they will have to act.

Mark Nayes
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Posted In: ACCA Now, Government, Opinion

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