DOE cancels rule on high-efficiency furnaces

The U.S. Department of Energy will rewrite energy efficiency standards for furnaces that were scheduled to go into effect in May for Minnesota and other northern states. The agency was poised to require newly installed furnaces in those cold-weather states be at least 90 percent efficient.

But under a settlement reached with a natural gas industry association, the Energy Department will forgo putting the new standard in place. The agency will review and reconsider the standard with a goal of issuing a new proposed rule within one year.

Environmental groups criticized the Energy Department's decision, saying the proposed standard would have cut heating bills by billions of dollars and reduced emissions that contribute to global warming.

Dave Seigel of the Builders Association the Twin Cities said that allowing people to forgo a high-efficiency furnace can make new and existing home projects more affordable.

"My understanding is the furnace unit itself is more expensive," Seigel said. "And in some case the installation of these units is challenging, and that can increase costs substantially."

Seigel said his members welcomed letting homeowners choose cheaper, less efficient furnaces.

"We really are in a marketplace where affordability is challenged these days," he said. "We're at that confluence of trying to be energy efficient, trying to do the right for the environment, and at the same time trying to be an affordable product for homeowners."