A federal court has struck down a Biden-era rule that imposed “green energy” requirements for new housing constructions, threatening the availability of affordable housing.
In 2025, Texas—along with 14 other states and the National Association of Homebuilders—sued the U.S. Department of Housing and Urban Development and the Department of Agriculture over a 2024 rule that required new homes being built “with certain federal housing financing to comply with significantly stricter energy-efficiency building codes.”
The case, co-led with Utah, was argued by Attorney General Ken Paxton in the U.S. District Court for the Eastern District of Texas in Tyler.
“The Corrupt Biden Administration’s radical policies were reducing the availability of affordable homes and making it harder for Americans to achieve the dream of homeownership,” stated Paxton. “This ruling is a major victory for homebuyers, builders, and families and helps protect access to affordable housing.”
Some of the “stricter energy-efficiency building codes” required by the Biden-era rule included the installation of stronger insulation, higher-efficiency windows, and upgraded HVAC systems. All would have increased construction costs for housing financed by FHA-insured mortgages, USDA rural housing loans, and other venues that rely on federal assistance.
Plaintiffs argued that the new rules would violate the Affordable Housing Act, as the cost of implementation “would severely limit affordable low-income housing.”
Enacted by Congress in 1990, the Cranston-Gonzalez Affordable Housing Act was passed to “‘reaffirm the long-established national commitment to decent, safe, and sanitary housing for every American,’ in part by increasing ‘the Nation’s supply of decent housing that is affordable’ and providing ‘a reliable, readily available supply of mortgage finance at the lowest possible interest rates.’”
The Act required the HUD Secretary to create energy efficiency standards for new housing constructions. Although this was supposed to be done soon after the Act’s passage, the agency did not create the standards within the originally specified time frame, leading Congress to amend the act several times to push back the deadline for the agency.
Not only did the court find that the rule would reduce the availability of affordable housing due to increased construction costs, but it also found that the rule exceeded both agencies’ statutory authority.
The court agreed with Texas that the act allows only a single update to the codes, which occurred after Congress acted in 2006.
HUD and USDA agreed in 2015 to adopt the 2006 standards laid out by Congress.
“If Congress had wanted the agencies to adopt code updates on an ongoing basis, then it would have no reason to reference a particular edition in the statute,” reads the court’s opinion.
Following this ruling, the 2024 energy standards have been vacated and are no longer in effect.
No ads. No paywalls. No government grants. No corporate masters.
Just real news for real Texans.
Support Texas Scorecard to keep it that way!
