Approximately 90 cities, 29 counties, and 20 towns across the United States have adopted some type of green building program.  So far, even what are considered the most aggressive green building codes, such Los Angeles’ and San Francisco’s, have not drawn any notable legal attacks.  On July 3, 2008, however, a group of national HVAC industry groups and local companies sued the City of Albuquerque, New Mexico, in federal district court to challenge two recently adopted green building city ordinances.

In 2007, the Albuquerque City Council unanimously adopted a High Performance Building Ordinance and a two-volume local Energy Conservation Code, which established air conditioner, furnace, heat pump, and water heater energy efficiency requirements that were more stringent the federal requirements.  For example, the new regulations would raise the standards for HVAC equipment in all new and retrofit commercial and residential projects to a Seasonal Energy Efficiency Ratio (SEER) of 15 for air conditioning and an Annual Fuel Utilization Efficiency (AFUE) of 90% for heating.  By comparison, the current U.S. Department of Energy (U.S. DOE) minimum standards for the same equipment are lower - at 13 SEER and 78% AFUE.

Although the city had originally set the adopted codes’ effective date as April 1, 2008, concerns raised by the local suppliers and other industry advocates led the city to delay the enforcement date to July 1, 2008.  The additional three months were intended to allow city leaders and industry advocates to resolve their differences through potential code amendments, including lowering certain standards and delaying the implementation of others.  Ultimately, the parties were unable to reach a compromise.

Despite the city’s further delay of the codes’ implementation date to October 1, the Air Conditioning, Heating and Refrigeration Institute, the Heating, Airconditioning & Refrigeration Distributors International, the Air Conditioning Contractors of America, and numerous HVAC product distributors and contractors brought suit in U.S. District Court for the District of New Mexico on July 3, to challenge the city codes.  The Plaintiffs’ complaint contended, inter alia, that the stricter city codes were preempted by federal law and the city cannot enforce them without obtaining a waiver from the U.S. DOE.  The Plaintiffs also contended that new codes would drive up the cost of HVAC equipment and installation, which, in turn, would lead to increases in new home construction costs, as well as illegal installations of cheaper, less efficient equipment by unlicensed contractors.

Although the likely outcome of this litigation is yet unclear, the Plaintiffs’ preemption argument portends new hurdles for the green building movement in which cities and counties have taken the lead so far.  As some green building bloggers have observed, this lawsuit “sets the precedent for local legislation to be challenged more extensively once regulatory activity at the federal level increases.” Furthermore, the “solution to challenges like those posed in this case may be federal green building standards, but this will prove challenging…. Ultimately, the compromises necessary to pass a national bill may result in lower standards than might have resulted from a patchwork of local regulations.”

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