The short version
Starting January 1, 2027, any new gas water heater sold and installed in the Bay Area must be a clean (zero-NOx) model. That almost always means a heat pump water heater. A few new gas tankless models qualify too.
You don’t have to change anything today. Your old heater can keep running. The rule only kicks in when you buy a new one — and only if you buy after January 1, 2027.
The Bay Area air board is also writing exemptions for older homes, tight closets, and homes that would need a costly electrical upgrade. Those should be final by mid-to-late 2026.
What the rule says
BAAQMD — the Bay Area Air Quality Management District, the regional air pollution agency — passed a rule called Rule 9-6. It’s part of a larger plan to cut nitrogen oxide pollution from things like home water heaters and furnaces.
Here’s the rule in one line: starting January 1, 2027, new gas water heaters sold and installed in the Bay Area must be zero-NOx. “Zero-NOx” means the heater doesn’t release nitrogen oxide pollution. The cleanest, easiest way to do that today is to skip gas entirely and use a heat pump water heater (a water heater that runs on electricity).
For homeowners, this is a one-time choice. It only matters when you replace your heater. You don’t need to do anything until then.
Who it covers
The rule covers homes in nine Bay Area counties:
- Alameda
- Contra Costa
- Marin
- Napa
- San Francisco
- San Mateo
- Santa Clara
- Southern Solano County
- Southern Sonoma County
It applies to single-family homes, condos, and small apartment buildings. Bigger commercial systems are covered by a separate rule with a later deadline.
Key dates
| When | What happens |
|---|---|
| Now → Dec 31, 2026 | You can install any kind of water heater — gas tank, gas tankless, heat pump. No restrictions yet. |
| Jan 1, 2027 | Rule starts. New gas water heaters must be zero-NOx models. |
| 2027 onward | Heat pumps become the standard replacement. Some new zero-NOx gas tankless options also appear. |
| 2031 | A separate rule covers larger tankless gas water heaters. Not relevant for most homes. |
What counts as a “clean” (zero-NOx) heater
Two types of new water heater meet the rule:
Heat pump water heaters
These run on electricity. They pull heat from the air around them (kind of like an air conditioner running in reverse) to heat your water. Because they don’t burn gas, they don’t release nitrogen oxide. Bonus: they’re 2 to 4 times more efficient than a gas tank, so you save on your power bill too.
Heat pumps come in two electrical styles:
- 240V (the standard kind).Needs a dedicated 240-volt circuit — the same kind your dryer uses. Most older Bay Area homes don’t have one without some electrical work.
- 120V plug-in. Plugs into a normal wall outlet. No electrical work needed. A great fit for older homes — often cuts the project cost in half.
Gas zero-NOx tankless
A few new gas tankless models meet the zero-NOx standard. These are usually pricier than a heat pump after rebates, but they fit in tight closets where a heat pump won’t. Worth asking about if your water heater lives in a small interior closet.
What the rule does NOT cover
- Your existing heater. No need to retrofit. It can run until it breaks.
- Replacements before January 1, 2027. Anything compliant today can still be installed today.
- Electric water heaters. Already clean (no gas = no NOx). Standard electric tanks are still legal but use way more power than a heat pump.
- Commercial water heaters. Different rule, different timeline.
- Furnaces, stoves, and other gas appliances. Furnaces are covered by a separate rule (with a 2029 deadline). Stoves and ovens aren’t covered.
- Homes outside the Bay Area. Nine BAAQMD counties only.
What’s still being decided
As of May 2026, the Bay Area air board is finalizing a list of exemptions — situations where you wouldn’t have to switch to a heat pump. Likely categories:
- Lower-income households (specifics still being worked out)
- Homes that would need a costly panel upgrade
- Homes that can’t fit a heat pump (tight closets, no ventilation)
- Hydronic radiant heating systems
- Small water heaters (under 30 gallons)
- Emergency replacements where you need hot water now
These are proposals. The board has to formally adopt them — that’s expected mid-to-late 2026. We’ll update this guide and our Exemption Guide the moment they’re final.
Rebates are also moving fast. Right now (May 2026), the $1,000 BayREN rebate and the federal 30% tax credit are open. Two big state programs (HEEHRA and TECH Clean California) are full and not taking new applications. We re-check this every month.
What to do, based on your situation
Your heater is broken right now
Take a breath. Before 2027 you can install any compliant heater — including a like-for-like gas tank if you need hot water back tonight. A heat pump works too, and it qualifies for the $1,000 BayREN rebate plus the 30% federal tax credit. Operating costs are lower for the next 10+ years.
Your heater is old (10+ years) but still working
Plan ahead while you have time. Get a contractor to look at your electrical panel — that’s the biggest cost wildcard. Locking in current rebates while they’re open is smart.
You’re researching for the future
Run the calculator and save your results. We’ll email you when rebates open or close (one email a month, no junk).
You’re renovating
If your renovation finishes after January 1, 2027 and includes a new water heater, the new heater needs to be zero-NOx. Plan for heat pump space and electrical capacity now — easier than adding it later.
You’re a tenant
The rule is on your landlord, not you. They handle the replacement. Run the calculator and grab the summary to share with them — it lays out the options.