The U.S. Department of Energy published a notice in the Federal Register on May 20, 2025 withdrawing its final rule on energy conservation standards for consumer gas-fired instantaneous water heaters. The withdrawal followed a joint resolution of disapproval under the Congressional Review Act, signed into law on May 9, 2025. DOE's notice says the December 2024 rule "shall have no force or effect".
This is a U.S. story, and it is now more than a year old. We include it in our launch coverage because it still shapes what manufacturers build for North America, and because Canadian homeowners and salespeople still repeat versions of it.
The rule that was withdrawn
The short answer: a December 2024 standard for gas tankless heaters that would have applied from late 2029.
DOE published the final rule on December 26, 2024, at 89 FR 105188. Its rulemaking page for consumer water heaters lists a compliance date for that rule of December 26, 2029. Before Congress acted, DOE had delayed the rule's effective date twice in early 2025: first to March 21, then to May 20.
The withdrawal notice itself does not restate the efficiency levels the rule would have set. It identifies the rule, cites the disapproval, and applies the result to 10 CFR Part 430. The docket number is EERE-2017-BT-STD-0019.
What remains in place in the U.S.
The short answer: existing gas tankless standards, plus a separate 2024 rule for other water heaters.
DOE's page points to the current standard in 10 CFR 430.32(d). It also lists an unrelated final rule for consumer water heaters, published May 6, 2024, with compliance required from May 6, 2029. The May 2025 withdrawal does not touch that rule.
The Canadian picture
The short answer: Canada's federal floor for gas tankless heaters was unchanged when we checked.
Canada regulates the same products separately. Natural Resources Canada's page for household gas-fired instantaneous water heaters, last modified November 20, 2025, lists minimums of 0.86 UEF for units with a maximum flow below 6.4 L/min and 0.87 UEF at 6.4 L/min or more, for products made on or after January 1, 2020. It mentions no upcoming change. Our explainer on Canada's tankless efficiency minimums covers the definitions and testing standard in more detail.
The timeline
The short answer: about five months from publication to withdrawal.
| Date | Action |
|---|---|
| December 26, 2024 | DOE publishes the final rule for consumer gas-fired instantaneous water heaters (89 FR 105188) |
| February 20, 2025 | DOE delays the effective date to March 21, 2025 (90 FR 9951) |
| March 20, 2025 | DOE delays the effective date again, to May 20, 2025 (90 FR 13054) |
| May 9, 2025 | Joint resolution of disapproval signed into law |
| May 20, 2025 | DOE publishes the withdrawal (90 FR 21390) |
DOE's notice does not discuss future rulemaking for this product class, and its rulemaking page listed no replacement compliance date when we checked in October 2026.
Analysis: why this still matters to Canadian installers
This section is TanklessNews.ca analysis.
- No new U.S. deadline is driving product changes. With the rule withdrawn, manufacturers face no new U.S. federal compliance date for gas tankless heaters. Product lines sold across North America are therefore less likely to change because of U.S. rules in the near term. Check with your distributor before assuming any model is being discontinued.
- Don't sell on "the ban is coming". Some sales conversations still lean on a pending ban to push condensing units. In the U.S. that rule is gone, and Canada has published no equivalent. Sell condensing models on what they actually do, such as cooler flue gas that typically allows certified plastic venting, and higher efficiency, not on a deadline.
- Watch rebate rules instead. For Canadian contractors, utility rebate lists are where efficiency really bites. SaskEnergy's August 2026 rebate terms set their own bar and their own model list.
- Date your content. Pages written in 2024 that describe a coming U.S. standard are now wrong. If your site has one, update it or take it down.
We are a marketing and business consulting service for HVAC and heating companies, not a contractor, and this is not regulatory advice. Our rebate, code and recall content service keeps pages like these accurate. Browse the newsroom for related stories, or call, text or email.
Frequently asked questions
What did the U.S. DOE withdraw?
Its final rule titled Energy Conservation Standards for Consumer Gas-Fired Instantaneous Water Heaters, published December 26, 2024 at 89 FR 105188. DOE's notice of May 20, 2025 says the rule shall have no force or effect.
Why was it withdrawn?
Congress passed a joint resolution of disapproval under the Congressional Review Act, which was signed into law on May 9, 2025. DOE's notice formally removes the rule as a result.
Does this change Canadian rules?
Not directly. Canada sets its own minimums under the Energy Efficiency Regulations, 2016. When we checked in October 2026, NRCan's page listed a UEF floor of 0.86 or 0.87 for household gas tankless heaters, depending on flow rate.
Are other U.S. water heater standards affected?
DOE's rulemaking page still lists a separate May 2024 final rule for consumer water heaters, with compliance from May 6, 2029. The withdrawal applies to the gas-fired instantaneous rule only.
Sources
- Federal Register, 90 FR 21390: Energy Conservation Program, withdrawal of the consumer gas-fired instantaneous water heater final rule (May 20, 2025) (2025-05-20)
- U.S. Department of Energy: Consumer water heaters rulemaking page (2026-10-23)
- Natural Resources Canada: Gas-fired instantaneous water heaters (2026-10-23)