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Bay Area rule signals a new era for building electrification

Building Decarbonization Bay Area


Bay Area air regulators approved a zero-emission appliance standard in a vote Wednesday, March 15. The Bay Area Air Quality Management District’s (BAAQMD) new rule, which will begin in 2027 for water heaters and 2029 space heaters, will set the stage for widespread adoption of highly efficient electric heat pumps in buildings throughout the region. 

BAAQMD’s new rule is a big step toward a swift and orderly transition to zero emission buildings that will impact an already growing heat pump market. But it’s just one step. Heat pumps are becoming immensely popular in the U.S. because they lower energy usage, save money on utility bills, and eliminate several sources of air pollution. For the first time, in every month of 2022, heat pump shipments outpaced gas furnaces. Between 2015 and 2020, heat pump use for space heating jumped 50 percent to nearly 18 million U.S. households. And today, more households use electricity than gas for heating – up from just 25 percent of homes 30 years ago. While these trends are encouraging, our work is nowhere near done. Now, more than ever, our coalition needs to harness the momentum of the industry and put our noses to the grindstone when it comes to creating a robust electrification marketplace. 

Our job is twofold: First, we must support efforts to align regulations between jurisdictions, which will keep costs down and make the transition easier, more equitable, and more affordable for everyone. Second, the coalition needs to encourage and reinforce incentive and educational programs that help every building industry stakeholder along the supply chain acclimate to the change.

Aligning regulations. While it is motivating to see regulatory agencies recognize the need to provide clear direction to manufacturers, piecemeal legislation can have a negative market impact. If every local authority across the country made a slightly different rule, it would not only delay the timeline for market growth but make compliance prohibitively expensive for manufacturers and installers. We are working to identify and reinforce streamlined policy approaches across the country to ensure a just, equitable, and affordable transition.

Programs and assistance. Alongside any state regulation that sets a phaseout date for fuel-fired appliances, it is critical to have meaningful support for the workforce, including incentives and training; consumer rebate and financing programs; reforms to ensure ratepayers are not stuck paying for stranded assets; and complementary policies that promote neighborhood-scale decarbonization. Programs like TECH Clean California, which incentivizes contractors and households alike to upgrade to clean, electric heat pumps, are effective. 

The BAAQMD ruling means that our Coalition must come together stronger than ever to promote a streamlined regulatory approach at the state and national level. Over 100 cities, affecting 20% of Americans, have already made electrification rules; we track them and know how disparate they can be. Raising these regulations to the state level will help us move at a larger scale and a faster pace, and with more predictability. California and New York have started this process and we’re seeing folks in the Northeast come together to do the same. 

The decarbonization movement is experiencing unprecedented growth. We are excited to see legislators continue to catalyze the market, and for manufacturers and contractors to take up the mantle of innovation.