DOE’s Proposed Process Rule Revisions: The Impacts on Energy Efficiency
By Paul Donohoo-Vallett, OP/EERE alum; Dr. Kathleen Hogan, S3/S4/EERE leadership alum; and Tarak Shah, S1/S4 alum
On July 7, 2026, the U.S. Department of Energy (DOE) published a Notice of Proposed Rulemaking (NOPR) proposing major structural updates to the “Process Rule“ (10 CFR Part 430, Subpart C, Appendix A)—the procedural framework that governs how DOE sets energy efficiency standards and test procedures for residential and commercial appliances such as refrigerators and HVAC systems.
While the regulatory text frames this as an administrative refinement to provide increased certainty for impacted stakeholders and to better inform DOE’s decision on whether and at what level appliances should be regulated, the accompanying press release instead says the NOPR will “permanently end home appliance and equipment mandates that raise costs and disrupt consumer choice.”
DOE does not possess the administrative discretion to curtail or effectively end the program. Congress established the program through the Energy Policy and Conservation Act of 1975 (EPCA) to reduce the nation’s growing demand for energy, conserve scarce nonrenewable energy resources, strengthen U.S. energy security, and protect consumers from unnecessary energy costs. Since then, Congress has reaffirmed and expanded the program, recognizing that minimum efficiency standards are an effective means of reducing energy consumption, while maintaining product performance.
EPCA establishes a mandatory, non-discretionary obligation for DOE to conduct periodic six-year reviews of covered products and, where warranted, update standards to achieve the maximum improvement in energy efficiency that is technologically feasible and economically justified. Today, these congressionally mandated standards continue to deliver the benefits Congress intended by saving the average household hundreds of dollars each year on energy and water bills, reducing overall energy demand, and ensuring consumers have access to efficient, high-performing, and affordable appliances.
The proposal introduces several significant changes which together likely act to make it substantially more difficult for DOE to meet the Congressionally-mandated schedule for reviewing energy standards and deliver the intended consumer savings. Major changes include:
Asymmetrical framework: Imposes binding procedural requirements and analytical hurdles strictly binding only on actions that strengthen energy conservation standards or expand the reach of the program, while maintaining greater flexibility for actions that weaken or eliminate existing standards.
Flexibilities with negotiated rulemakings: Removes long recognized flexibilities with standard setting for consensus and negotiated rulemakings.
More restrictive analytical thresholds: Establishes rigid, one-size-fits-all screening criteria that would prevent DOE from pursuing many rulemakings unless they satisfy arbitrary energy savings, cost, and payback thresholds. These include requiring projected savings of at least 2 quads or a 10% reduction in energy use over 30 years, limiting installed cost increases to 10%, and requiring simple payback within half of a product’s lifetime before DOE can fully evaluate a range of potential standards. This approach conflicts with EPCA’s product-specific framework, which directs DOE to evaluate each product on its own merits and determine whether a standard is technologically feasible and economically justified based on the full statutory analysis.
Rising electricity prices, data center expansion, and global energy market volatility make appliance and equipment efficiency a vital tool for consumer savings and grid reliability. Adding hurdles and restricting flexibilities the DOE currently has as proposed for direct final rules could leave domestic manufacturers with stranded capital investments, increase legal vulnerability under mandatory review deadlines, and expose US markets to less-efficient foreign competition. Public comments on the proposal are due August 21, 2026.
Context
Appliance and equipment efficiency standards established under EPCA are effective federal policies for reducing energy demand, improving grid resilience, saving consumers billions on utility bills, and lowering greenhouse gas emissions. According to DOE data, standards implemented since 1987 saved American households and businesses $105 billion on utility bills in 2024 alone (saving a typical household about $576 per year).
Congress established federal appliance standards to set baseline efficiency levels for products sold or imported in the U.S. By creating a single national standard, federal rules prevent a confusing patchwork of state-level regulations—lowering overall costs for manufacturers and consumers alike. They also establish a transparent, level playing field and shield domestic manufacturers from low-quality overseas imports that attempt to undercut market prices.
To ensure that the process to adopt these energy-saving standards remains predictable, transparent, and grounded in rigorous technical analysis, DOE codified the Process Rule in 1996 to guide standard-setting and test procedure development process. The goal of a codified process was to help all parties engage in rulemaking while remaining adaptable and flexible for the huge variety of energy-using devices covered by the rules.
Major revisions in 2020 during the first Trump administration codified strict binding timelines, additional mandatory early assessment steps, and hard numeric thresholds for the energy savings to be attained for a rulemaking to proceed. Subsequent rulemakings during the Biden administration in 2021 and 2022 restored flexibilities, citing the challenges that rigid constraints cause in mitigating regulatory backlogs and restricting DOE ability to respond to market shifts. The current Process Rule serves as a general guideline, allowing DOE to adapt to consensus-driven joint proposals or unique market conditions so long as deviations are publicly communicated and justified.
The July 2026 NOPR marks another significant swing of the regulatory pendulum. By making procedural steps binding when tightening standards but optional when rolling them back, the proposed rule creates an asymmetric administrative environment designed to stall standard updates. Understanding the proposed shifts of this NOPR is essential for energy stakeholders navigating the tension between executive policy directives and EPCA’s enduring statutory mandate.
Key Changes
Here we dive deeper into the impacts of three key changes in the proposed updated Process Rule.
New bifurcated procedures for regulatory vs. deregulatory actions: The proposed rule introduces an asymmetric framework that makes it significantly easier to weaken or repeal existing energy standards as compared to adopting or amending an energy standard. By imposing binding procedural and analytical requirements only on actions that increase the stringency of standards or expand product coverage, while preserving greater flexibility for deregulatory actions, the proposal tilts the standards program away from the statutory objective established by Congress in EPCA.
Currently, the procedures outlined in the Process Rule are “generally applicable,” and give DOE the flexibility to deviate as necessary so long as deviations are communicated and justified. This applies across all important regulatory actions (e.g., allowed for cases such as the minimum timing between final test procedures and standards proposals) and provides DOE with the necessary flexibility to address specific situations that arise which would generally benefit all stakeholders.
The proposed rule would make all steps binding under every circumstance - except for certain deregulatory actions where required notice and comment periods can be reduced and otherwise required early assessment analyses can be skipped.
The proposed language says “The rulemaking procedures established in this appendix are binding on DOE for actions that are anticipated to increase the stringency of a standard or increase the scope of products subject to compliance with a standard. With respect to other actions, DOE will satisfy the requirements in EPCA and may choose to apply additional provisions in this appendix as may be appropriate so as to maintain flexibility and to provide relief without undue delay in appropriate cases.”
DOE justifies this bifurcated approach under the assumption that deregulatory actions either have no or limited costs to manufacturers, are easier to implement, and can result in savings to consumers. That assumption, however, is not universally valid. Deregulatory actions that weaken or eliminate existing energy conservation standards can impose significant costs on manufacturers that have already invested in product redesign, tooling, testing, and supply chains to comply with current standards. By permitting the sale of lower-cost, less efficient products, such actions may disadvantage domestic manufacturers that have made those investments, expose them to increased competition from new market entrants offering lower-efficiency products, and erode the level playing field that existing standards were designed to provide. While some products may carry lower upfront purchase prices, consumers could ultimately face higher lifetime operating costs through increased energy consumption, undermining the consumer savings that EPCA’s standards program is intended to deliver.
Removing significant flexibility for negotiated final rules: Congress provided DOE with direct final rule (DFR) authority under EPCA to expedite the adoption of consensus energy conservation standards. When interested parties submit a joint recommendation that is “fairly representative of relevant points of view” and DOE determines that no substantial adverse comments are likely, DOE may issue the standard as a direct final rule rather than first publishing a proposed rule and undertaking an additional round of notice and comment. This authority reflects Congress’s recognition that where stakeholders have already negotiated a broadly supported outcome, duplicative procedural steps are unnecessary.
Consistent with this statutory framework, DOE has long interpreted its DFR authority as providing additional flexibility not generally available in traditional standards rulemakings. Because consensus agreements are the product of negotiations among manufacturers, consumer advocates, efficiency organizations, and other stakeholders, DOE has allowed approaches such as phased compliance dates, multiple efficiency tiers, alternative metrics, and other tailored compliance pathways where necessary to achieve the maximum improvement in energy efficiency that is technologically feasible and economically justified. These flexibilities have enabled stakeholders to reach agreements that might not otherwise have been possible while providing manufacturers with greater regulatory certainty and consumers with earlier access to energy savings.
DOE has successfully used this authority in numerous rulemakings. For example, in 2024 DOE adopted, through a direct final rule, a joint proposal submitted by the Association of Home Appliance Manufacturers (AHAM), the Appliance Standards Awareness Project (ASAP), and other manufacturer, consumer, and efficiency stakeholders covering five categories of household appliances. The final standards become effective in the coming years through 2030 and provide substantial consumer savings.
The July 2026 NOPR would remove the flexibilities with the DFR, and relatedly reduce the benefits DOE can provide to stakeholders. The proposal specifies a number of new procedural steps for DOE to undertake if pursuing a negotiated rule including use of an independent convener when there are multiple proposals and use of an advisory council working group and public notice when undertaking a negotiated rulemaking.
New specific thresholds for increasing appliance efficiency stringency: The DOE Appliance and Equipment Standards Program covers an extraordinarily diverse range of products, from external power supplies that consume only a few watts to large commercial rooftop air conditioners and industrial equipment that consume orders of magnitude more energy. Because these products differ dramatically in their energy use, shipment volumes, operating characteristics, and market conditions, a one-size-fits-all threshold for determining whether a rulemaking should proceed is neither practical nor consistent with the statutory framework Congress established.
EPCA recognizes this diversity by requiring DOE to evaluate each covered product on its own merits. Rather than imposing a uniform minimum energy savings threshold, the statute directs DOE to conduct a product-specific analysis that considers the maximum improvement in energy efficiency that is technologically feasible and economically justified, taking into account the characteristics of the product, consumer impacts, manufacturer impacts, and other statutory factors. This framework allows DOE to determine whether updating a particular standard is warranted based on the circumstances of that product and the market at the time of the rulemaking.
More specifically, the EPCA statute requires a proposed standard to result in “significant energy savings” but otherwise did not define that term. The existing Process Rule provides DOE with the flexibility to define this on a case-by-case basis considering the specifics of a given industry or appliance, enabling DOE to consider the specific context of a market, technology, or regional differences. For example a nation-wide look might not see a significant relative reduction in energy even though there may be regionally significant energy reductions.
The proposed rule removes this flexibility with a proposed threshold of 2 quads of full fuel cycle energy savings or a 10% relative energy savings from that appliance category over a 30-year lifetime. (For reference, the U.S. consumes nearly 100 quads of primary energy annually). This assessment occurs before any other cost or benefit analysis is completed.
The ability of DOE to set quantitative thresholds for energy savings was addressed in a 1985 court ruling in Herrington vs. NRDC. There, the ruling confirmed that while DOE has significant discretion in determining a threshold for what energy savings count as “significant,” it specifies that “Congress could not have intended to set that threshold so high as to throw away cost-free chances to have non-trivial amounts of energy.”
The proposed thresholds would prohibit DOE from pursuing a hypothetical standard that imposed no costs, and would prevent the DOE from providing consumers with collectively significant savings across a suite of small rules. Similarly, the quantitative threshold would prevent assessment of standards that may have smaller energy savings but result in outsized cost savings for consumers because they occur during periods of high energy costs. For example, a hypothetical standard that targets energy savings during peak electricity demand periods can help avoid expensive infrastructure investment and therefore avoid significant cost increases for consumers, but could be negated by the proposed strict quantitative threshold.
Conclusion
The July 2026 proposal introduces administrative friction into the Appliance and Equipment Standards Program. By replacing product-specific analysis with rigid screening thresholds, adding procedural hurdles, and eliminating long-standing flexibilities that facilitate consensus rulemakings, the proposed changes constrain the toolset Congress provided under EPCA. Concurrently, these barriers impair DOE’s ability to conduct the timely periodic reviews mandated by law.
For over four decades, the program has balanced regulatory predictability for manufacturers with tangible consumer savings, reduced energy demand, and enhanced grid reliability. Departures from EPCA’s tailored framework threaten this baseline—introducing market uncertainty for regulated industries while diminishing future economic and energy-efficiency returns.
In response to joint requests from trade organizations seeking additional time to analyze the proposed changes, DOE extended the public comment window from August 6 to August 21, 2026.
Interested parties—including appliance manufacturers, energy advocates, state officials, and consumers—can submit formal comments and data regarding the Notice of Proposed Rulemaking (NOPR):
Online: Go to Regulations.gov under Docket EERE-2025-BT-STD-0001.
Email: Submit written input directly to the rulemaking team, including docket EERE-2025-BT-STD-0001 in the subject line.
All submissions must be received by August 21, 2026.
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This piece was drafted by trusted and vetted alumni of the U.S. Department of Energy. Any views and opinions expressed are that of the author(s) and do not reflect those of the DOE Alumni Network.