The original Final Determination, published in April 2024, concluded that the adoption of the updated energy codes would not negatively impact either the affordability or availability of federally funded housing. That decision was backed by detailed modeling of incremental construction costs, energy savings, and lifecycle cost-effectiveness. However, since then, inflation, energy price volatility, and supply chain instability have raised concerns about the codes’ real-world application.
Now, HUD and USDA are requesting feedback on whether any of the assumptions underlying their affordability analysis have materially changed.
“The public has had time to begin planning and implementing the Final Determination’s requirements. With that perspective, HUD and USDA would like to better understand how the adoption of the updated codes is working in practice,” the agencies stated in the July 7 Federal Register notice.
The agencies’ original analysis found:
Despite higher upfront costs, both DOE and the agencies found these investments to be offset by long-term utility savings and potential operational efficiencies.
To accommodate a diverse range of project types and builder preferences, HUD and USDA approved a flexible set of alternative compliance paths. These include:
Builders are encouraged to suggest additional standards that meet or exceed the 2021 IECC baseline for possible inclusion.
The codes apply to newly constructed housing financed through an array of HUD and USDA programs under the Energy Independence and Security Act (EISA), including:
They do not apply to the purchase or rehabilitation of existing housing.
Comments can be submitted online at www.regulations.gov by referencing docket FR–6271–N–05, or by mail. HUD and USDA are particularly interested in:
The Trump Administration has influenced this process by delaying the compliance dates for both HUD and USDA programs by six months in early 2025—part of a broader deregulatory posture aimed at reducing perceived burdens on the housing market. While the administration did not reverse the 2024 Final Determination adopting the 2021 IECC and ASHRAE 90.1-2019 standards, the delays reflect a strategic pivot to ease short-term affordability pressures amid ongoing inflation and construction cost volatility.
Industry groups such as the National Association of Home Builders supported the pause, framing it as necessary relief during a housing supply crisis. The question now is whether this administration’s actions signal a longer-term shift in federal housing energy policy—or merely a temporary recalibration.
As more states implement stricter codes and federal funding becomes increasingly tied to climate resilience and decarbonization goals, this ongoing review highlights the importance of striking a balance between advancing energy performance and maintaining housing affordability. With compliance extensions already in effect and technical assistance under development, the agencies appear committed to a collaborative implementation process.
