Alejandra Reyes-Velarde  | Cal Matters

New household water heaters and heating systems powered by natural gas would be phased out in the Los Angeles basin under two controversial rules that air quality regulators will vote on Friday.

Manufacturers would sell increasing percentages of zero-emission heating appliances in the four-county Los Angeles basin — beginning with 30% in 2027 — and pay fees if they sell natural gas ones, under the draft rules.

Home appliances are among the largest sources of smog-causing gases remaining in the L.A. basin, according to the South Coast Air Quality Management District. Officials there say the measures would eliminate the second largest amount of pollutants of any rule they have enacted over the past several decades.

Consumers won’t have to switch their appliances. However, when their natural gas water heaters, central heating systems and furnaces break down and it’s time to replace them, they can choose to buy zero-emission heat pumps powered by electricity.

Based on the lifetime of these appliances — 25 years for heating systems and 15 years for water heaters — about 200,000 furnaces and 300,000 water heaters will be replaced annually in the region, according to the air district.

The cost of buying and installing a heat pump to replace natural gas appliances varies, depending on what people need: Replacing an entire HVAC system with a heat pump would cost consumers about the same or even less than a natural gas system, according to the South Coast district’s estimate. But installing a heat pump instead of a natural gas water heater would cost $2,000 more, and replacing just a furnace would cost $8,000 more.

Contractors and developers oppose the phaseout, saying the fees paid by manufacturers will be passed on to residents, businesses and landlords.

“This money is not coming out of thin air,” said Brian Johsz, advocacy manager for the Los Angeles County Business Federation. “It’s a solution in search of a problem in a lot of ways. It’s just putting the financial burden on residents when we are already seeing they have such a hard time trying to make ends meet right now.”

SoCalGas officials say the rules would limit consumer choices and raise the cost of appliances. The company also said the measures would be preempted by federal law because they effectively ban appliances covered by the Energy Policy and Conservation Act.

“Over time, the public will be forced to pay hundreds of dollars more to replace their gas appliances,” wrote Kevin Barker, a senior manager for SoCal Gas’s energy and environmental policy, in a letter to the district. “It is not in the public interest, especially at a time when consumers are demanding affordable energy solutions, to raise upfront costs of the most affordable options.”

But air quality officials say that consumers will save money by switching to electric heaters. Between 2027 and 2061, residents in the four-county region will collectively save an annual average of between $191 million and $250 million on utility bill costs by switching from natural gas to electricity, according to the district’s estimate.

Under the proposed rules, manufacturers have two compliance options: They can sell all zero-emission units by 2027 or they can pay a fee for each gas appliance they continue to sell. The funds will be used to offer incentives to help low-income residents and landlords buy heat pumps.

Environmental groups say the air agency should move more quickly. The L.A. region still has the nation’s worst smog despite half a century of efforts, so it has a long way to go before its residents breathe air that meets federal health standards.

“There are still a lot of emission reductions that are being left on the table that will either have to be taken up with subsequent rules or are being foregone,” said Chris Chavez, deputy policy director with the Clean Air Coalition,

The air quality agency’s original plans, which were years in the making, would have guaranteed substantially more emissions reductions. The proposal would have required manufacturers to sell 100% zero-emission water heaters and furnaces by 2031. But after pushback from businesses and gas companies about affordability concerns, the air district amended it.

Under the current draft, the targets are 30% of water heaters and furnaces sold in 2027 would be zero-emissions, ramping up to 50% in 2029, 75% in 2033 and 90% in 2036. Manufacturers will have to pay fees between $500 and $50 for each natural gas one sold in the region.

The air district expects 90% of all water heaters and furnaces in the region will be zero emissions in 2061.

Chavez said the original version was projected to eliminate 10 tons per day, accounting for 18% of all the nitrogen oxide emissions in the basin. The proposal as written now reduces emissions by six tons per day.

Nihal Shrinath, an attorney for the Sierra Club, said “we’ve seen the Trump administration really waging a war on clean energy. And concurrently we have the South Coast (district) basically caving to gas lobbying efforts and really weakening a rule they have been working on for years.

“All the while, the air district is in extreme noncompliance with federal air quality standards and we’re the most polluted air basin in the country,” he said.

The South Coast district’s governing board will hold a public hearing and vote Friday on the measures, which update two emissions rules that the agency set in 1978 and 1982.

Billions of dollars in health savings

Gas appliances in the L.A. region — mostly water heaters and furnaces — emit more nitrogen oxides and fine particles into the air than power plants, refineries and oil and gas production combined, according to the non-partisan research group Rocky Mountain Institute.

The basin’s 10 million water heaters and furnaces emit almost 7 tons of nitrogen oxides and 1.5 tons of fine particles each day. In comparison, oil refineries — the region’s largest industrial polluters — emit less. Vehicles are the largest sources, emitting 11.5 tons of nitrogen oxides a day.

Nitrogen oxides react with other gases in the air and bake in the sun to form ozone, the main ingredient of smog, which causes asthma attacks and other health effects. The gases also pollute indoor air and can trigger respiratory effects. Fine particles can lodge in lungs and raise the risk of heart attacks and respiratory disease.

Between 2027 and 2053, the rules would save $59 billion in health expenses, according to the air district. Each year, the reduction in pollution would prevent an average of 280 new asthma diagnoses, 44 emergency room visits from respiratory problems and 6,100 lost school days, according to the district’s data. That doesn’t include health benefits calculated from the reduction in fine particles.

The Bay Area already has similar rules, enacted in 2023, that mandate zero-emission water heaters in 2027, furnaces in 2029 and large commercial water heaters in 2031. However, they are being amended to allow more flexibility for manufacturers to comply.

The region’s two largest cities, Los Angeles and Long Beach, have passed resolutions supporting the South Coast district’s rules, while Huntington Beach, Fullerton, Riverside, Rancho Palos Verdes and other conservative cities are opposed.

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