The Regulatory Landscape for Commercial Building Electrification

by David Harrison, BOMA SF Manager of Government and Public Affairs

As local and state governments approach their climate goals to get to Net Zero, commercial buildings represent one of the largest targets for electrification mandates. Years removed from pledges of decarbonizing by a certain target date, local governments are now implementing the actual policies that will enforce the rules to get to their targets. Carbon emissions from space heating represent about a third of emissions from commercial buildings. Building owners should be aware of the rapidly approaching regulations that will govern their natural gas boilers in the years to come.

Outside of their own ESG strategy, building owners, their management team, and their engineering teams should be familiar with the three regulatory bodies that will govern their natural gas usage: The California Air Resources Board (CARB), The Bay Area Air Quality Management District (BAAQMD), and the City and County of San Francisco. These three agencies have either enacted or proposed regulations that would eliminate the use of natural gas in existing commercial buildings.

To meet federal ozone standards and state-mandated decarbonization goals, CARB has proposed banning the sale of new natural gas heaters, water heaters, and furnaces by 2030. CARB will now engage in a public process and finalize a program by 2025. Similarly, the BAAQMD has approved a new regulation that will ban the sale of new natural gas equipment in commercial buildings by 2031. Both the state and regional plan would not mandate that an existing system be replaced by that date, but that a system be replaced upon the end of its useful life.

The City’s Aggressive Climate Action Plan

San Francisco’s Climate Action Plan is even more aggressive than the state and regional plans. Under the Climate Action Plan, the City’s current goal is to mandate that all large commercial buildings replace their existing natural gas equipment by 2035. This proposal still requires approval from the Board of Supervisors and will likely be joined by other potential implementation measures such as a carbon emissions tax.

While these goals are admirable, the impact on building owners in San Francisco could be significant. For many buildings, converting from natural gas to electric power is not technically or financially feasible, especially for space-constrained structures that are not currently suitable for electric heat pumps. Recognizing these challenges, BOMA SF is working to secure exemptions from these proposals in certain cases. BOMA argues that building owners should not be forced to bear the full cost of converting their buildings to electric equipment, especially if they are already very efficient or unable to do so through simple project paybacks.

BOMA staff and committee members sit on local and regional task forces charged with voicing these concerns to policy makers. We will continue to promote policies that allow us to meet these goals in a manner that is technologically and financially feasible. As this process plays out, it is critical that building owners and their management teams start thinking about their pathway to electrification now.

To learn more about these issues contact David Harrison at davidh@boma.com or consider joining BOMA SF’s Energy & Environment Committee.

WE DO IT RIGHT THE FIRST TIME!

The Plumbers, Steamfitters & HVACR of UA Local 38 and the Electricians and Technicians of IBEW Local 6 represent a Skilled & Trained Workforce that help construct Affordable Housing for the San Francisco Bay Area.

Our apprentices and journey-level workers spend years, in both on the job training and classroom education, to develop the skills and knowledge of their crafts. We are the EXPERTS in the plumbing and electrical trades and maintain our skills through upgrade classes covering the newest and best techniques in the industry.

For well over a century, the Solidarity, Teamwork, and Respect between Building Trades members working together on jobsites has ensured the delivery of the highest quality craftsmanship that is 100% union built, completed on time and on budget.