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Take a look at this view from Windy Hill on a warm winter day in January.
The PurpleAir app puts numbers to this layer of brown smog:
Ugh. Living with this is not healthy. The good news is, we know what to do about it.
We can reduce the high levels of nitrous oxides (NOx) that lead to smog by reducing emissions from our refineries, our vehicles, and our buildings.
There is new satellite evidence that EV adoption in California is cleaning up our air, and EV adoption continues to grow. That helps! The extremely polluting Valero refinery in Benecia is closing soon. That will also help. But what about the largest source of pollution, which emanates from buildings where we burn gas for heat? What will it take to reduce that source of smog?
Public policy to reduce building pollution is proving to be tricky. Here in the Bay Area, we have a mandate on the books to move away from gas-burning heaters (1). As air district commissioners have come to understand the cost and/or complexity of some installations, they are proposing to add a lot of flexibility for homeowners and contractors. This relatively friendly policy looks like it will stick, at least for water heating.
In contrast, the Los Angeles air quality district (South Coast Air Quality Management District, aka AQMD) went through considerable effort and discussion to land exactly nowhere in its efforts to reduce building pollution. At the state level we are also struggling. The California Air Resources Board (CARB) is now on its third attempt to formulate a policy, yet with little consensus. Why is this proving so difficult?
AQMD’s Spectacular Failure to Reduce Air Pollution from Buildings
The Los Angeles area has very poor air quality, among the worst in the country. The sole job of the AQMD is to improve it. And yet they failed to make any headway on reducing pollution from buildings despite an intensive two year effort.
AQMD initially proposed a ban on polluting heating equipment, similar to the Bay Area. This engendered vociferous opposition from the local oil and gas industry as well as from consumers who demanded the freedom to choose polluting appliances. After considerable public input, the air management district backed off, allowing gas heaters to be installed for a modest fee.
The fees, as low as $50, would nudge consumers and manufacturers towards less polluting heating equipment, and would provide funding to facilitate adoption of cleaner appliances by lower-income households.
The district specified heating equipment targets they expected to meet. If too many gas appliances were sold, then the fees would be higher on the excess heaters.
This strikes me as a pretty acceptable policy. “Pay to pollute” is a relatively popular form of regulation. The fees themselves are just a small fraction of the overall cost of these projects. Accommodations would be made for low-income households. And yet the proposal failed by a 5-7 vote among the commissioners.
I was (and am) really surprised by this failure. Yes, some of the equipment manufacturers objected to the record-keeping that would be needed to enforce this. But much of the public input was ill-informed. Many of those in opposition said they objected to a mandate, which this clearly is not. Others spoke of the expense to upgrade electric panels, a project that in reality is rarely needed with the new technologies and processes being deployed. And others worried about grid capacity, though Southern California Edison said these policies would have “relatively little impact”.
What happened? Some advocates pointed to misinformation from the oil and gas industries. The AQMD created a “Myths and Facts” one-pager to try to combat it, but it was too little too late. More recently, some have pointed to an AI campaign behind tens of thousands of public comments that may have influenced some of the commissioners.
I asked a few people to comment on what happened, but no one seemed to want to reflect on the record. This air district is legally obligated to do something about its air pollution, so I expect it will try again. (2)
CARB’s Building Decarbonization Proposals are Still Evolving
At the same time the Bay Area and South Coast Air Quality Management Districts have been pursuing policies to reduce regional reliance on gas heaters, California’s Air Resources Board has been evaluating state-wide proposals. That is harder since they cover a wide variety of geographies with very different climates, housing stock, utility infrastructure, and demographics. Any state-wide policy is bound to incorporate significant flexibility and adaptability.
The California Air Resources Board moved from considering a mandate to suggesting, this past December, a gradual and partial phasing in of cleaner appliances, backed by a credit trading system to find the cheapest and simplest mechanisms to achieve those goals.
CARB proposes a hard limit on the percentage of heating appliances that are gas, decreasing slowly to 50% for water heating and 25% for space heating by 2040.
Manufacturers would earn credits for selling extra clean equipment (beyond their annual targets), and would need to buy credits if they fell below the targets. This is similar to how the Low Carbon Fuel Standard (for clean cars) works today to encourage manufacturers to develop and sell low-gas vehicles. Additional credits would be available for a few other things, such as technical innovation or donations to low-income households.
No one seems to like this proposal. The manufacturers claim that heaters are different from cars, that this policy will push up prices for everyone, and that burdening manufacturers with mediating this effort is unfair. They would prefer to see something like a flat fee assessed at point of sale, although manufacturers with good non-polluting options, like AO Smith, are much more supportive than those without.
Environmental advocates cannot understand why credits are being handed out for innovation that would happen anyway, why CARB is vastly overstating the electrical costs of these installations, or why the clean equipment targets are so conservative. The electric utilities are generally supportive, but gas utility SoCalGas strongly objects, calling the proposal expensive, complicated, and possibly illegal.
While all of this is going on, the federal government is pushing back in its own way. The Environmental Protection Agency is working to reduce the health costs attributed to nitrous oxides, which would make crafting clean-air policy more difficult. In particular, they have stated that a person’s life should be worth $0 (!), rather than the $10 million standard used today. Since government policies generally need to balance economic costs with economic benefits, this would reduce the economic benefits of the policies, meaning we would have a much smaller budget to clean up our air.
CARB has its work cut out for it!
What Happens Next?
What will it take to get all of us to move from gas to electric heat? At the heart of many of the policy concerns is the cost of switching, and there is good news on that front. We are finally modernizing a very conservative electric code, which today requires oversizing electric panels (e.g., because the calculations do not account for the efficiency of LED lighting). At the same time, electricians are becoming more familiar with tools like circuit splitters that can accommodate electric heating loads with minimal changes. These changes will make electrification simpler and less costly.
There is also continued pressure on utilities to lower electric rates. When electric heat is cheaper than gas, people will naturally gravitate to it. Moreover, at least in the short-term, gas prices are soaring due to fighting in the Middle East. Customers do not like price volatility, and we have seen significant spikes in gas over the years.
But economics is not the only issue. Homeowners who can afford to switch face challenges understanding their options and evaluating bids. Palo Alto aims to lower these barriers with their recently-launched concierge service for residential electrification. It expands on the successful water heater program to offer support for space heating, cooking, and more. The program will make it easier for households that proactively want to move away from gas to do so. As that happens, the workforce should get more skilled, costs will come down, and technology will improve, making the switch easier for yet more homeowners. In time funding and/or policy changes from the air district, state and federal governments may also help.
Responding to Your Comments
Related to this topic, one of you commented on the plan to electrify water heaters: “I believe these dictates should be for new housing, not for retrofit. This will be costly and complicated to retrofit for some of us (indications are).”
There are already strong policies in place to encourage all-electric new housing. These policies are specifically for retrofits. The air district commissioners understand that while heat pump water heater installations are often simple, some will be more complex, and some will be unaffordable. That is why the Bay Area Air Quality Management District is proposing to offer exceptions very generously and easily, particularly in the early years as the market is still maturing.
Someone else wrote: “California has too many environmental regulations. A zero-pollution scenario desired by green activists/interest groups is not feasible nor realistic in a free society with economic mobility. Which raises the question: Do these same people want to live in a free society? Or do they really want the government micromanaging everything/everyone with lockdowns and rationing of energy, housing, jobs, transportation, etc. to ‘reduce emissions’?”
I think this is the key political question. On the other hand, we’ve had clean fuel standards and Energy Star appliance codes for years. No one likes pollution, and most people don’t even know if they have a gas or electric water heater. So this “freedom of appliance” thing mystifies me. In my mind, the key issue is economics, not freedom of fuel choice. Many people are fine paying a little more for less polluting choices. But at some point cost becomes a meaningful concern, and some of these building costs can be significant. Every house and every household has different costs and different abilities to pay them. The policies have to be sensitive to that, and that in my view is the key challenge, not politics or fuel libertarianism. Electric heat is very popular in conservative states where it is the most accessible and affordable option.
Notes
1. This would take effect for residential water heaters in 2027 and for gas furnaces in 2029. Replacements for large commercial or multi-family water heaters could continue to be gas-powered until 2031.
2. The Los Angeles area has many sources of nitrous oxides beyond buildings, in particular because of a massive airport and a massive port in the area. Only a fraction of these are in the scope of AQMD. Others are under state or even federal jurisdiction. So that is another reason why this situation is difficult.
The field is set: Meet the candidates officially running for California governorMarch 6, 2026 6:54 pm