Bay Area air regulators voted 16-1 Wednesday to delay the state\u2019s first phaseout of gas water heaters by a year and let up to half of property owners who replace one skip the switch to electric heat pumps. <\/p>\n
The rule, adopted in 2023, does not require anyone to replace a working water heater. But starting in January 2028, a year later than planned, most Bay Area property owners replacing a gas water heater will have to install a model that emits no nitrogen oxides, typically an electric heat pump.<\/p>\n
Low-income owners, those who spend heavily on housing, and homes with tight spaces or outdated electrical systems can apply for exemptions.<\/p>\n
The vote is the latest sign that California is easing off on its push to cut pollution from home appliances, one of the largest sources of smog-forming emissions. <\/p>\n
Last year, Southern California air regulators rejected a plan to phase out gas water heaters and furnaces, and the California Air Resources Board has backed away from requiring all new space and water heaters sold to be zero-emission by 2030.<\/p>\n
Supporters say the Bay Area is different. Regulators built in years to review the rules before they took effect, and SPUR, a Bay Area urban policy nonprofit, says the exemptions largely match what environmental groups asked for to address property owners\u2019 concerns, even if they go further than advocates would have liked. <\/p>\n
In an email, an air district spokesperson said the just-passed water heater rule would prevent up to 16 premature deaths and 21 new asthma cases annually, and avoid $90 million in healthcare costs. But staff also estimate the exemptions could put roughly half of the rule\u2019s originally projected pollution cuts out of reach.<\/p>\n
A heat pump water heater costs about $3,500 more to install than a gas model, according to the air district. Heat pump water heaters use roughly a third to a quarter as much energy as standard gas models, but because electricity often costs more than gas in California, savings on utility bills are smaller. <\/p>\n
Property owner groups say the rules will become a financial burden to many residents. <\/p>\n
\u201cThe proposed mandate really doesn\u2019t take into account all the nuances that have to be factored in when you look at many of the multi-unit buildings in the Bay Area that were built in the \u201960s and \u201970s, and even much earlier,\u201d said Joshua Howard, executive vice president of local public affairs for the California Apartment Association.<\/p>\n
Some board members agreed. Ray Mueller, a San Mateo County supervisor, said he wished the board could repeal the rule entirely. Shamann Walton, a San Francisco County supervisor, voted no after speaking about affordability concerns. Benicia Mayor Steve Young abstained. <\/p>\n
But board member John Gioia, a Contra Costa County supervisor who voted to delay the rule, said the amendments address affordability concerns. <\/p>\n
\u201cWe need to do this in a way that respects that lower-income residents may not be able to afford it. We need to figure out how to help them,\u201d Gioia said. \u201cAnd let\u2019s face it, the exemptions are big enough to drive a truck through.\u201d <\/p>\n
Who\u2019s exempt<\/p>\n
Under the amended rule, people with incomes at or below 80% of the area median, or who are enrolled in programs such as Medi-Cal or CalFresh, can avoid installing an electric water heater and instead install a gas one. So can people whose mortgage and property tax payments add up to at least 28% of their gross income. The air district estimates about 20% of Bay Area households qualify.<\/p>\n
Homes with physical barriers, such as a cramped closet, a low ceiling or an electrical panel too small to handle a heat pump, get a one-time exemption, covering an estimated 20% of installations. People can continue to buy water heaters 30 gallons or smaller, about 10% of sales, because no zero-emission models of that size are available in the U.S.<\/p>\n
Larger water heaters, common in apartment buildings and businesses, now have until 2033 instead of 2031. <\/p>\n
Statewide efforts<\/p>\n
The state Air Resources Board, which once aimed for all new space and water heaters sold in California to be zero-emission by 2030, has scaled back its plans. <\/p>\n
At a December 2025 workshop, air board staff proposed instead capping sales of gas models and creating a credit system that would let manufacturers switch to zero-emission equipment more slowly. <\/p>\n
The air board is \u201ccontinuing to meet with interested parties to understand their feedback and evaluating potential revisions,\u201d to the rules, said spokesperson Lindsay Buckley. <\/p>\n
Still, the state backed the Bay Area\u2019s rule. In a letter to the board, an agency official said the rule \u201ccontributes to California\u2019s broader strategy to reduce building-sector emissions while delivering public health, clean air, environmental justice, and climate benefits.\u201d <\/p>\n
In Southern California, the South Coast Air Quality Management District proposed rules last year that would have set rising targets for manufacturers to sell more zero-emission appliances, with fees on gas models. It backed down under pressure from the Trump administration. <\/p>\n
Advocates say that makes the Bay Area\u2019s rule, even scaled back, a rare step forward.<\/p>\n
\u201cThe state and the Bay Area are doing a great job of trying to push things forward in a more challenging environment,\u201d said Tony Sirna, deputy policy director of environmental group Evergreen Action. \u201cWe\u2019re pedaling just as hard, but we\u2019re facing headwinds, and so we are making slower progress than we would have otherwise.\u201d <\/p>\n
The cost of switching<\/p>\n
The air district estimates up to 120,000 Bay Area households replace a water heater each year. <\/p>\n
A consultant for the district estimated the amended rules will cost those households about $372.8 million a year, after accounting for about $60.8 million in energy bill savings. Howard, of the apartment association, said the district \u201cneeds to recognize the true cost of the mandate.\u201d<\/p>\n
Adam Pearce, president of the California Rental Housing Association, said the newly-passed rule does not fix property owners\u2019 concerns, and just \u201ckicks the issue down the road.\u201d <\/p>\n
\u201cWe\u2019re not against clean air and healthy living. Certainly providing quality housing coincides with all of that,\u201d he said. But forcing change isn\u2019t the answer, Pearce added. \u201cThey would get a lot more buy-in over time if it was incentive-based.\u201d<\/p>\n
Advocates say incentives can help close the gap. The Bay Area will receive about $55 million a year in heat pump incentive funds over the next few years, according to SPUR estimates, said Sam Fishman, a policy manager for the group.<\/p>\n
\u201cThese rules are a really big deal,\u201d Fishman said. \u201cThey are a strong market signal that can ramp up demand for heat pumps in California, show that they work, and build demand both from consumers, from contractors, from manufacturers at every level of the supply chain.\u201d<\/p>\n