The move affects both existing homes and new construction. Here are the details
If you live in the Bay Area and your natural gas-powered water heater stops working after 2027, you will be required to install an electric model instead.
Bay Area regulators voted Wednesday to adopt rules to phase out the sale and installation of natural-gas furnaces and water heaters over the next eight years, one of the most ambitious plans in the country to replace gas appliances with electric alternatives.
The rules, approved by the Bay Area Air District Management Quality District, are meant to reduce air pollution from some of the worst home appliance offenders. The main pollutants targeted are nitrogen oxides (NOx), which can cause acid rain and smog as well as increase risk for asthma and other respiratory diseases.
People will be able to repair their gas appliances if they break – but the rules take effect when existing gas-powered furnaces or water heaters no longer work and need to be replaced. New construction will also be required to have zero-NOx – effectively, electric – furnaces and water heaters.
Here’s what to know about how the rules affect you:
What appliances do the rules apply to?
The rules target natural gas-fired furnaces and water heaters, which account for about 90% of the nitrogen oxides emitted from the Bay Area’s 1.8 million homes, according to the BAAQMD.
They require zero NOx models be sold and installed in the Bay Area – essentially requiring that gas-powered water heaters switch to electric, and that gas-powered furnaces switch to heat pumps.
The rules do not apply to gas stoves. They also don’t apply to gas-powered dryers, water heaters larger than 2 million BTU/hr, appliances that use propane or other non-natural gas fuels and mobile home furnaces.
When do the rules take effect?
By 2027, zero NOx models for water heaters smaller than 75,000 BTU/hr are required. By 2029, zero NOx models for furnaces are required. By 2031, zero NOx models for water heaters larger than 75,000 BTU/hr and smaller than 2 million BTU/hr are required.
However, the air district could push back those deadlines if it determines that the burden of compliance by those dates will be too difficult.
The district doesn’t expect the region’s 1.8 million homes to entirely switch over for nearly 25 years.
What homes are affected?
The Bay Area Air Quality Management District’s regulatory jurisdiction comprises Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, southwestern Solano and southern Sonoma counties. Roughly two-thirds of all Bay Area households use natural gas appliances, according to the air district.
The furnace rules do not apply to mobile homes.
What is the goal of the rules?
The primary goal of the adopted rules is to improve outdoor air quality, as natural gas-powered heaters and furnaces release pollutants outside. Requiring zero-NOx appliances would not only reduce nitrogen oxides but also particulate matter 2.5 (PM2.5), tiny pollutants small enough to infiltrate lungs and even blood.
The air district estimated that 37 to 85 premature deaths from health complications caused by air pollution would be avoided each year due to the adopted proposals. That translates to approximately $400 to $890 million in estimated annual health benefits, according to the air district’s calculations.
It would also speed up the region’s transition to electric appliances and reduce reliance on fossil fuels, with many public commenters at the approval meeting Wednesday speaking in favor of the rules’ potential benefits in mitigating climate change.
How much does a replacement cost?
In the lead-up to approval, the rules have prompted deep concerns from residents about the costs and logistical challenges of upgrading home electrical panels and appliances in the given timeline.
The air district released its estimates of equipment costs: $8,030 for zero NOx space heaters (which would substitute for gas furnaces) and $2,820 for zero NOx water heaters.
Installing electrical appliances may also require upgrades to home electrical panels, which the air district estimated will cost $2,630 for zero NOx space heaters and $960 for zero NOx water heaters.
Are there tax incentives or rebates to replace appliances?
The Inflation Reduction Act passed by Congress last summer includes $8.8 billion in rebates for home energy efficiency and electrification projects, with more than $582 million allocated for California.
These rebates will be available to the public in 2024, according to the California Energy Commission. They include an $8,000 rebate for heat pumps, a $1,750 rebate for heat pump water heaters and $4,000 for electrical system upgrades.
Available now for both heat pumps and electric water heaters, a tax credit covers 30% of costs up to $2,000.
What other concerns exist surrounding these regulations?
Some public commenters at Wednesday’s approval meeting highlighted ongoing power outages from the latest atmospheric river to hit California, and voiced concerns about access to heat and hot water in power outages when the regulations take effect.
The air district said Wednesday that another common concern is that electrical system upgrades can take a while, and may leave residents stranded in an emergency. In response, air district staff said loaner programs of natural gas-fired appliances could be used as upgrades occur.
What is the Bay Area Air Quality Management District?The BAAQMD creates regulations regarding air quality and air pollution in the nine counties of the Bay Area. It is governed by a 24-member Board of Directors made up of locally elected officials from each county, with the number of representatives proportional to each county’s population.
The agency is best known among the public for its Spare the Air campaign, which alerts residents when air quality is forecast to be unhealthy.
How do these rules compare to other all-electric rules in the region?California has ambitious plans for an all-electric future: In September, Gov. Gavin Newsom signed climate bills that will require the state to become carbon-neutral by 2045 and produce 90% of its electricity from clean sources by 2035.
No natural gas power plants are to be built. The state plans to ban the sale of new natural gas-fueled heaters by 2030 – a few years after the Bay Area regulations passed Wednesday – though the plan hasn’t been formally approved. By 2035, Californians for the most part will not be able to buy new gasoline-powered cars.