This month’s Legal Angle brings some good news for the electrical industry in New York City. On March 18, 2025, the Southern District of New York granted the City of New York’s motion to dismiss a lawsuit brought by various parties, including the Association of Contracting Plumbers of the City of New York, Inc. and Plumbers Local Union No. 1, which sought a permanent injunction of Local Law 154 of 2021, known as the New York City Building Electrification Law (“Local Law 154”).
As members are likely aware, Local Law 154 generally prohibits the use of fossil fuels such as natural gas and heating fuel in newly constructed residential buildings in New York City as part of New York City’s effort to meet its carbon-neutrality goals, improve air quality, and “create a city that is cleaner and greener.” Specifically, Local Law 154 prohibits the combustion of substances emitting 25 kilograms or more of carbon dioxide per million BTUs in new residential buildings. This effectively bans fossil fuel powered appliances, like gas stoves, furnaces, and water heaters in new construction with phased implementation: buildings under seven stories were to comply by January 1, 2024, and taller buildings are to comply by July 2, 2027.
Importantly, the law applies only to new construction, leaving existing buildings untouched. It also includes exceptions for specific uses, such as commercial kitchens and hospitals, ensuring flexibility where electrification might be impractical. The bottom line for NYECA contractors is Local Law 154 should generate more electrical work on new construction due to the limitation on the use of gas-powered appliances.
In their lawsuit, the plaintiffs argued Local Law 154 was expressly preempted by the federal Energy Policy Conservation Act of 1975 (“EPCA”), and thus the federal law must take precedence and invalidate New York City’s local law. The plaintiffs’ complaint cited the following express preemption clause within the EPCA: “…no State regulation concerning the energy efficiency, energy use, or water use of such covered product shall be effective with respect to such product.” The plaintiffs claimed that Local Law 154’s ban “concerns” the “energy use” of EPCA regulated appliances, by effectively reducing their energy consumption to zero, which would conflict with the federal law.
For context, the federal EPCA requires certain products meet specific energy conservation standards before placing the product in the marketplace. The EPCA requirements include: (1) testing the product; (2) certifying the product meets the applicable energy conservation standard; and (3) including an energy efficiency data label on the product.
In response to the complaint, the City filed the subject motion to dismiss claiming the facts, as alleged by the plaintiffs in their complaint, were insufficient to establish a claim for which relief could be granted.
The court granted the motion to dismiss, finding the EPCA does not preempt Local Law 154, “because it does not concern energy use as EPCA defines that term.” The court interpreted the EPCA’s definition of “energy use” to mean a fixed value “represent[ing] the amount of energy a product consumes under typical conditions,” for which that covered product may not enter the consumer market without meeting such standards. The court refused to accept the plaintiffs’ interpretation of “energy use” as relating to the amount of energy consumed by the product once in the hands of the end user. Such interpretation by the plaintiffs erroneously implies the manufacturer must somehow monitor the consumers’ use of the product after installation.
Local Law 154, in contrast, does not concern product standards before entering the marketplace. Rather, it regulates the type of fuel that a covered product may consume in certain settings, regardless of a specific product’s energy efficiency. Furthermore, Local Law 154’s language likely played an important role. In contrast to local laws in California that were preempted for banning gas piping outright, Local Law 154 sets an emissions threshold that indirectly discourages fossil fuels without prohibiting certain infrastructure.
While it is likely the plaintiffs will appeal this decision to the Second Circuit, Court of Appeals, for now, New York City electrical contractors can take this as a win toward creating more electrical work that would have otherwise been allocated to plumbers.
Andrew J. Mundo, Esq., MURTAGH, COHEN, BYRNE & MURDY