Bay Area regulators finalize rules to phase out gas water heaters

The Bay Area Air District board approved final amendments to a regulation that limits pollution from residential water heaters in the San Francisco Bay Area.

The new rule establishes zero-nitrogen-oxides emissions standards for new home water heaters sold in the region. While the board originally planned an earlier start date, the measure will now take effect in 2028.

To address affordability, the district included exemptions for low-income households, owners of small water heaters without heat-pump alternatives, and those with specific space or electrical constraints. Owners of multifamily buildings have until 2033 to complete the transition. The district says gas appliances in the region emit more nitrogen-oxides pollution than passenger vehicles. This pollution contributes to approximately 85 premature deaths and 15,000 asthma attacks every year.

Greg Nudd, the deputy executive officer of policy at the air district, says eliminating these emissions could provide health benefits worth $1.1 billion per year. The regulation faces opposition from various industry groups and property owners who worry about the high cost of switching to heat-pump technology. However, supporters argue the move will lower utility bills and improve public health.

The district expects a household to save between $40 and $50 per year on utility bills once a heat-pump system is paid off, while the think tank RMI estimates average savings could reach $360 per year for most households.