Bay Area air district pushes its zero-NOx water heater standard to 2028 and adds exemptions
The board's 16-1 vote moves the date for larger units from 2031 to 2033. Lower-income and cost-burdened owners, and homes where a heat pump won't fit, can still install gas.
By The Gradient Report Staff
Key points
The Bay Area Air Quality Management District board voted Nov. 4 to amend Rule 9-6. The zero-NOx standard for water heaters up to 75,000 BTU/hr now starts Jan. 1, 2028, instead of Jan. 1, 2027.
Units from 75,000 to 2 million BTU/hr move from Jan. 1, 2031, to Jan. 1, 2033. Multifamily buildings, deed-restricted affordable housing, hydronic systems and high-temperature business uses are also exempt until 2033.
Owners under 80% of area median income, or paying 28% or more of income on mortgage and property taxes, can install a gas water heater. Homes with tight space or limited electrical service get a one-time exemption.
District staff estimated that up to half of small water heaters could qualify for an exemption or extension.
The Bay Area Air Quality Management District's board voted on Nov. 4 to delay the first zero-NOx deadline for gas water heaters by one year and to add exemptions for lower-income households and hard-to-convert homes. The vote was 16-1, CalMatters reported. San Francisco County Supervisor Shamann Walton voted no, citing affordability, and Benicia Mayor Steve Young abstained, according to CalMatters.
Under the amended Rule 9-6, the zero-NOx standard for water heaters and boilers rated at 75,000 BTU/hr or less applies to units manufactured after Jan. 1, 2028, according to the district's October staff report. The 2023 version of the rule set that date at Jan. 1, 2027. Units from 75,000 to 2 million BTU/hr now have until Jan. 1, 2033, instead of Jan. 1, 2031.
The standard applies only when an owner replaces a water heater, the district said in its Nov. 4 release. It does not require anyone to remove a working unit. In practice, most owners replacing a gas water heater after the deadline will install an electric heat pump model, CalMatters reported.
Who is exempt
The amendments add three kinds of exemptions, according to the district release and staff report.
Income. Owners with household income at or below 80% of area median income qualify, as do those enrolled in programs such as Medi-Cal or CalFresh. So do households whose annual mortgage and property tax payments equal at least 28% of gross household income, which owners can self-attest under the staff report's definition. Staff counted 564,674 of the region's 2,845,928 households, or 19.8%, as lower-income or cost-burdened.
Space and electrical limits. A home qualifies once per address if the water heater sits in an enclosed space under 700 cubic feet that can't be ventilated for compliant equipment, in a garage with a ceiling under 7.2 feet, or in another indoor space with a ceiling under 6 feet. Electrical limits include service under 100 amps, no breaker space, or a new 240-volt circuit that would need more than 50 feet of conduit, certified by a licensed contractor. Staff estimated these constraints cover about 20% of installations.
Time-limited exemptions. Hydronic systems, buildings with five or more units, deed-restricted affordable housing, nonprofit mutual housing cooperatives and businesses that need water at 160°F or higher are exempt for units manufactured before Jan. 1, 2033.
Water heaters of 30 gallons or less, about 10% of sales, can still be sold because no zero-NOx models that small are available in the U.S., the staff report said. Mobile home water heaters are also exempt. Owners must get an exemption certificate from the district before installation.
Taken together, staff estimated up to 50% of small water heaters could be eligible for an exemption or extension, and that roughly half of the NOx reductions the 2023 rule was expected to deliver could fall under exemptions. The district must report back to the board on the 2033 date and the exemptions by Jan. 1, 2031.
Homes where a heat pump water heater won't fit in the existing space get a one-time exemption under the amended rule.AI-generated illustration
Cost and health estimates
A heat pump water heater costs about $3,500 more to install than a gas model, CalMatters reported. A district consultant estimated the amended rules would cost up to 120,000 Bay Area households a year about $372.8 million, after about $60.8 million in energy bill savings, according to CalMatters. The district says the rule could prevent up to 16 premature deaths and 21 new asthma cases a year, CalMatters reported.
"Water heaters are a significant source of air pollution in the Bay Area," Philip Fine, the district's executive officer, said in the release.
Property owner groups said the changes did not go far enough. Joshua Howard, executive vice president of local public affairs at the California Apartment Association, told CalMatters the district "needs to recognize the true cost of the mandate." Adam Pearce, president of the California Rental Housing Association, said the rule "kicks the issue down the road." San Mateo County Supervisor Ray Mueller wanted the rule repealed, CalMatters reported.
Tony Sirna, deputy policy director at Evergreen Action, told CalMatters the delay means "making slower progress than we would have otherwise." Sam Fishman, policy manager at SPUR, called the rules "a really big deal."
Furnace date unchanged
The board's action covered Rule 9-6 only. The district's zero-NOx standard for residential and commercial furnaces under Rule 9-4 still applies to units manufactured after Jan. 1, 2029, according to its implementation page and rule development page. Staff had recommended against pushing the small water heater date past 2029, citing alignment with that furnace deadline, the staff report said.
At the state level, the California Air Resources Board has scaled back its goal of making all new space and water heaters sold in the state zero-emission by 2030, CalMatters reported. Air Resources Board spokesperson Lindsay Buckley said the board is still evaluating possible revisions to its rules.
The contractor group said "Clean Heating Coalitions" are preparing refrigerant bills in at least a dozen states. The Washington and New York rules it cited come from a building code proposal and a state HFC rule already on the books.
