Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Department of Energy relating to "Energy Conservation Program: Energy Conservation Standards for Commercial Water Heating Equipment".

This joint resolution, H.J. Res. 15, directly nullifies the Department of Energy's final rule titled "Energy Conservation Program: Energy Conservation Standards for Commercial Water Heating Equipment" (88 Fed. Reg. 69686 (October 6, 2023)). This rule would have imposed more stringent energy conservation standards on commercial water heaters. The nullification means manufacturers are not required to meet these stricter standards, which immediately reduces their compliance costs and avoids significant retooling or redesign expenses. The market for commercial water heating equipment will continue to operate with the existing, less stringent energy efficiency requirements. The money trail in this scenario is defined by cost avoidance. Manufacturers of commercial water heating equipment will save capital expenditures that would have been necessary for research, development, and production line modifications to meet the new standards. This regulatory relief directly benefits companies that produce commercial water heaters. The absence of new standards means these companies can continue to sell their current product lines without interruption or additional investment in energy efficiency upgrades. Historically, regulatory rollbacks or delays in environmental standards have consistently provided a short-term boost to affected industries by reducing operational overhead. For example, when the EPA delayed implementation of certain emissions standards for power plants in 2017, utilities and coal producers saw a temporary uplift as they avoided immediate upgrade costs. While specific market data for water heater standard changes is limited, the principle of reduced regulatory burden leading to increased profitability or avoided costs is well-established. This resolution, sponsored by Rep. Messmer (R-IN-8), indicates a clear legislative intent to prioritize industry cost savings over energy conservation in this specific sector. Specific winners include major manufacturers of commercial water heating equipment. A. O. Smith Corporation ($AOS) is a significant player in this market and directly benefits from not having to re-engineer its commercial product lines. Watts Water Technologies Inc. ($WAT), through its various brands, also manufactures commercial water heating components and systems, and will see reduced compliance pressure. Trane Technologies plc ($TT), which offers commercial HVAC and water heating solutions, also benefits from the stability of current manufacturing requirements. There are no direct losers in terms of market share, but companies that had already invested heavily in developing products compliant with the stricter standards may see a temporary disadvantage as their early investments are not immediately required by the market. What happens next is that H.J. Res. 15 proceeds through the legislative process. Given it is a joint resolution of disapproval under the Congressional Review Act, if passed by both chambers and signed by the President, the DOE rule will be permanently nullified. The immediate effect is that the commercial water heater market will continue operating under the prior, less stringent energy conservation standards. Manufacturers will continue to produce and sell equipment without the previously mandated upgrades.