Fifth Circuit Rejects Energy Department Direct-to-Final Rule on Home Appliances

Last week, a panel of the U.S. Court of Appeals for the Fifth Circuit granted a petition for review of a Biden Administration Department of Energy direct-to-final rule limiting the energy use of stoves and ovens.

Judge Oldham wrote for the panel in Mississippi v. Department of Energy, joined by Judge Ho. Judge Haynes concurred in the judgment. The intro of Judge Oldham’s opinion, makes clear he does not like the rules at issue.

The Biden Administration proposed numerous regulations to make home appliances more expensive and less useful. See, e.g., Louisiana v. DOE, 90 F.4th 461 (5th Cir. 2024). As part of that effort, one official even proposed banning gas stoves. See Ari Natter, US Safety Agency to Consider Ban on Gas Stoves Amid Health Fears, Bloomberg (Jan. 9, 2023), https://perma.cc/7E2V-DFN5 (quoting statement of Consumer Product Safety Commission official Richard Trumpka, Jr.). These efforts generated significant controversy and public backlash.

Rather than confront that controversy, the previous Administration attempted to dodge it. In this case, the Department of Energy created new regulations on home cooking appliances, including gas stoves, through a “Direct Final Rule.” What does that mean? It means the Biden Administration promulgated a rule without giving the public advance notice or the opportunity to comment on it. Petitioners are several States that are aggrieved by the Direct Final Rule. Their objections are well taken, so we grant the petition for review.

Although the Energy Policy Conservation Act provides for the promulgation of direct-to-final rules, so as to facilitate the quick adoption of consensus-based or otherwise non-controversial standards, the panel concluded the Department overstepped here, and had sought to use the DFR process to evade engaging with substantive objections to the new rules. Judge Oldham writes:

The previous administration’s gas-stove measures were among its most controversial energy proposals. The idea that all that controversy could be elided using the DFR—a mechanism designed for consensus rulemaking—is untenable. And it’s all the more untenable in the face of the EPCA’s comment and review provisions, which the Department would have us rewrite.

Interestingly enough, the Trump Administration has also sought to evade the notice-and-comment process in some of its rulemakings, embracing an unconventional (and quite aggressive) interpretation of the “good cause” exception within the Administrative Procedure Act (APA). I discuss two examples in my forthcoming article, “Unsustainable Presidential Administration,” one of which also involves the Department of Energy (repeal of the showerhead definition), as well as the OIRA memo encouraging agencies to use the “good cause” exception more aggressively. The Fifth Circuit’s rationale could cause problems for such efforts, particularly if adopted by other circuits.