Key Takeaways

1. In 2023, the Department of Energy is likely to increase enforcement of its energy and water conservation standards.
2. The penalties associated with violating energy and water conservation standards can exceed $500 per violation and result in multi-million-dollar penalties.
3. Manufacturers and importers of appliances and other consumer and industrial products can mitigate enforcement risk by refamiliarizing themselves with the energy and water efficiency regime and conducting internal compliance audits.

As the Biden Administration enters its third year, now with a party split in Congress, it seems likely that the Administration will redouble its focus on executive branch regulatory tools that can be used to achieve energy-related policy objectives, including with respect to energy efficiency and reducing carbon emissions. For manufacturers and importers of appliances and certain other consumer, lighting, plumbing and commercial and industrial products, that means the potential for additional scrutiny of their products’ compliance with the Department of Energy’s (DOE) conservation standards for energy and water efficiency. It also likely means a commensurate increase in DOE enforcement activity for non-compliance with the applicable efficiency standards or the associated test procedures required to demonstrate compliance, as well as registration and labeling requirements. Given the magnitude of the penalties associated with violating efficiency standards, currently $503 per violation, which can quickly run into multiple millions of dollars across noncompliant units, manufacturers and importers should consider refamiliarizing themselves with DOE’s conservation standards regime.