Synopsis

Trade groups for the gas industry, builders, building owners, and developers sued the Maryland Department of the Environment, arguing that the state’s Building Energy Performance Standards are preempted by the federal Energy Policy and Conservation Act (EPCA). 

Why It Matters for Public Health

Climate change is widely accepted as the greatest threat to global public health, and any policy that reduces the extent of climate change helps protect health. Further, actions that reduce energy use and greenhouse-gas emissions also reduce indoor and local air pollution. For example, recent studies show that gas stoves create harmful levels of nitrogen dioxide and benzene inside the home, comparable to secondhand smoke.

The policies challenged in this case, called “Building Performance Standards,” are particularly important for climate and health. Building performance standards cap certain large buildings’ greenhouse-gas emissions, then reduce that cap over a period of years.  Building performance standards are one of the few types of green-building regulations that apply to existing buildings, rather than being limited to new buildings or renovations. As a result, they are crucial to addressing the health impacts and emissions of existing buildings.

Background

EPCA is a federal law that, among other things, creates energy-efficiency standards for certain appliances and allows the U.S. Department of Energy to amend those standards and create others. EPCA also preempts state and local regulations “concerning the energy efficiency, energy use, or water use” of an appliance that is covered by EPCA. Generally speaking, EPCA preemption has been considered to preclude only state or local regulations that try to set energy efficiency standards for EPCA-covered appliances. However, in California Restaurant Association v. City of Berkeley, the Ninth Circuit held that EPCA also preempts certain kinds of regulations that are not efficiency standards, but which have the effect of preventing the use of EPCA-covered appliances.

Maryland’s Building Energy Performance Standards covers buildings that are 35,000 square feet or larger. It sets declining performance standards by building type, measured in net direct emissions of kilograms of carbon dioxide equivalent per square foot. There are interim standards for the years 2030-2034 and 2035-2039, with the final standard of zero for most building types in effect in 2040. Historic buildings, elementary and secondary schools, manufacturing, agricultural buildings, and federal buildings can apply to be exempted and there is also a financial distress exemption. Building owners can also choose to pay an alternative compliance fee per ton of emissions, which increases over time.

The plaintiffs in this case allege that the Maryland regulations are preempted by EPCA as interpreted by the Ninth Circuit. (Importantly, Maryland is not in the Ninth Circuit, and therefore the federal court that will hear this case is not required to follow the Berkeley decision.)  Specifically, the plaintiffs argue that the Maryland regulations are preempted because they “concern the energy use and energy efficiency of EPCA-covered gas appliances” and do not qualify for one of the exceptions under EPCA.

Litigation Status (Open)

The plaintiffs filed their complaint on January 13, 2025 and the case has been assigned to Judge Deborah Boardman. The state filed a motion to dismiss the case on April 1, on two grounds: First, that the court should adopt the interpretation of EPCA preemption used by the Southern District of New York, under which EPCA preemption would be limited to appliance efficiency standards, rather than the Berkeley standard, under which EPCA preemption could also apply to prohibitions on gas appliances in new buildings. Second, that preemption would be inappropriate even under the Berkeley standard, since building performance standards do not apply to new buildings and do not prohibit the use of gas appliances. PHLC, the Sierra Club, and the Chesapeake Climate Action Network filed amicus briefs in support of the state’s position.

On April 21, the plaintiffs amended their complaint. The state moved to dismiss the new complaint, making substantially the same arguments; PHLC, Sierra Club, and CCAN filed updated amicus briefs in support.

On March 31, 2026, the District of Maryland issued their decision to dismiss the case, finding that the Building Energy Performance Standards are not preempted by EPCA.

On April 29, the case was appealed to the Fourth Circuit. The opening brief was submitted on June 15, and the state responded on July 29.