By Bradford White Corporation
On March 15, 2023, the Bay Area Air District (BAAD) Board of Directors unanimously approved a proposal from their staff to require all residential water heaters in their jurisdiction emit zero NOx emissions after January 1, 2027. Since that time, various stakeholders have been working with BAAD to explain the multitude of challenges in enacting this policy, particularly as it relates to existing buildings.
BAAD is just one of 35 air districts that exist throughout the State of California. These bodies are charged with enacting rules and policies that ensure the areas they are responsible for either maintain compliance with federal air quality standards or are brought into closer compliance. While BAAD is an autonomous rulemaking body their policies, along with those of their sister organization, South Coast Air Quality Management District (SCAQMD), are often emulated by other air districts throughout California, as well as cities, counties, and states throughout the country. Additionally, they are the first regulatory body in the United States to enact such a stringent requirement for existing constriction. For that reason, the District’s 2023 decision requiring zero NOx emissions water heaters has certainly drawn the attention of many interested parties.
However, on October 24, 2025, BAAD proposed amendments to this rule that would allow gas-fired water heaters with capacities under 35 gallons to remain on the market until at least 2031. Additionally, the proposed changes would allow for homeowners to be exempt from the zero NOx requirements if they are experiencing significant challenges with:
- Electrical system upgrades;
- Space constraints at the installation location;
- Emergency product replacements; and
- Financial hardships.
BAAD is accepting feedback on these amendments from stakeholders until November 24, 2025. It is expected that their Board will vote on the amendments in the weeks or months that follow.
BAAD’s proposal comes just months after SCAQMD voted against implementing a proposal in their jurisdiction that would have charged water heater manufacturers significant fees for selling certain amounts of gas-fired water heaters into their District. SCAQMD is now reconsidering this proposal in their committee process and has vowed to readdress the issue in 2026.
The proposed rule amendments by BAAD also come while New York Governor Kathy Hochul is actively considering a one-year delay of her state’s, first in the nation, all-electric new building mandate that is set to take effect on January 1, 2026. All of these actions are welcome news to stakeholders who favor measures to combat climate change but fear that all-electric or zero NOx emissions policies are too aggressive and create unintended consequences for individuals, families, and job providers where they are enacted. What is ultimately decided in these jurisdictions, and others that are actively considering similar policies, however, remains to be seen.
If you have any questions about these policies, or have any other government-related questions, concerns, or topics you’d like to discuss, BWC’s Government and Regulatory Affairs Team is always happy to help in any way we can. Please feel free to reach out to us directly at BWCGovReg@bradfordwhite.com.
