CITY COUNCIL STAFF REPORT – REGULAR AGENDA
TO: HONORABLE MAYOR AND CITY COUNCIL
FROM: CHRISTABEL SORIA MENDOZA, MANAGEMENT ANALYST I
DATE: OCTOBER 30, 2024
SUBJECT: DISCUSSION OF ELECTRIC READINESS ORDINANCE
AMENDING SECTION 15.19.030 OF THE ATHERTON
MUNICIPAL CODE
CEQA: Adoption of the Ordinance is not subject environmental review under the California Environmental Quality Act (CEQA) in that it is categorically exempt under the CEQA Guidelines, Section 15308, Actions by Regulatory Agencies to Protect the Environment.
RECOMMENDATION
Staff recommends that the City Council review and discuss an ordinance that would amend Chapter 15.19 of the Atherton Municipal Code relating to the 2022 California Green Building Standards Code along with local modifications that enhance electric-ready requirements for new construction and major alterations; and provide policy direction to staff regarding outdoor gas appliances, such as grills and barbeques, which are not regulated by the Energy Policy and Conservation Act (EPCA) and are currently exempt from the electric-ready provisions.
BACKGROUND
The Town adopted the 2022 California Green Building Standards Code (CALGreen), as outlined in Chapter 15.19 of the Atherton Municipal Code, which regulates construction practices to improve public health, safety, and general welfare by promoting sustainable building practices.
The current code integrates environmentally responsible standards, including energy efficiency measures, and applies to all new buildings and major alterations within the Town.
Since adoption, the Council discussed various enhancements to the standards by introducing local amendments that require electric readiness. These amendments ensure that new homes and applicable renovations are prepared for future electrification, aligning with both State and regional efforts to reduce reliance on natural gas and support the transition to all-electric buildings. Council also directed that staff continue focus on next steps within the Town’s Climate Action Plan, which includes furthering electric readiness in new construction and as part of significant home renovations.
During a February 26, 2024, Study Session, the City Council reviewed various options for implementing these enhancements. Two primary approaches were presented:
Item No. 2
Town of Atherton
1. Energy Performance Approach: This option focused on decarbonizing buildings by regulating energy performance under the energy code while still allowing the use of natural gas appliances. It was designed in response to the California Restaurant Association v. City of Berkeley ruling.
2. Electric Readiness Measures: This approach requires the installation of electrical infrastructure (e.g., wiring for future electric appliances) but does not mandate the immediate switch to electric appliances. It prepares buildings for future electrification at the most cost-effective stages—during new construction or significant renovations.
Although the Energy Performance approach was explored, the Council raised concerns about the complexities and timeline associated with it. This approach requires approval from the California Energy Commission (CEC), a process that can take several months. After further investigation, staff found that the 2025 Energy Code will increase prescriptive requirements, rendering the pointbased performance approach less applicable for single-family buildings in Town. Staff does not recommend pursuing the point-based Energy Performance approach. Instead, staff recommends focusing on the Electric Readiness requirements.
The Electric Readiness Approach can be adopted quickly without requiring a CEC costeffectiveness approval. Though this approach doesn’t immediately reduce greenhouse gas emissions, it lays the groundwork for more seamless and affordable future electrification, aligning with upcoming regulatory changes such as the Bay Area Air Quality Management District’s (BAAQMD) 2027 and 2029 rules mandating zero-NOx appliance installations.
Council expressed support for the Electric Readiness approach, as it offered greater flexibility and is simpler to implement without immediate regulatory hurdles. Council specifically suggested including pool heaters for new construction (Table 2) and requested a detailed list of Electric Readiness requirements for existing buildings (Table 1). The Council also recommended determining appropriate electrical outlet types (e.g., 120V versus 240V) for various applications.
Reach Code Updates from Neighboring Cities:
• Brisbane has approved a Reach Code focusing on energy performance and increasing electric vehicle (EV) charger installations to support decarbonization efforts. • East Palo Alto recently passed an energy performance code that prioritizes electrification while expanding EV infrastructure across the city.
• Hillsborough is no longer enforcing portions of their Energy Reach Code, including the requirements for electric-only space and water heating in new residential construction.
Starting January 1, 2023, all projects that are submitted for building, plumbing, electrical and mechanical permits will be required to comply with the 2022 California Code of Regulations Title 24.
• Los Altos Hills’ Reach Codes apply to all newly constructed buildings, detached ADUs, and detached habitable structures, mandating that they be all-electric. In addition, singlefamily homes must provide one EV Ready parking space per dwelling unit. As part of the 2023 Code update cycle, the Town expanded the reach codes to include substantial remodels, focusing on zero NOx emissions for new and significantly altered existing structures.
• Los Gatos has implemented an all-electric reach code for new construction, effective December 17, 2019, mandating electrification for all single-family and low-rise multifamily buildings.
• Menlo Park has implemented Reach Codes aligned with its Climate Action Plan (CAP), emphasizing electric readiness in new developments and retrofits, with a strong focus on EV charging infrastructure.
• Millbrae is moving forward with new Reach Code initiatives that include electrification of buildings and a loaner program to support electric cooktops in residences. • Palo Alto implemented new Energy Reach Code requirements on October 4, 2024, mandating that new buildings and substantial remodels achieve a higher source energy compliance than the State Code and comply with electric readiness requirements. This includes requiring a Certified Energy Analyst for projects, pre-wiring for future electrical appliances when gas appliances are installed, and specific source energy compliance margins based on building type, such as exceeding standard requirements by at least 8 points for new single-family homes and 10% for new office and mercantile buildings. • Redwood City has suspended enforcement of its Reach Codes at this time. • South San Francisco has adopted Reach Codes that enhance building electrification efforts by requiring electric infrastructure readiness in new construction and major alterations.
ANALYSIS
Staff has crafted suggestions for ordinance amendments in response to the Council’s direction to address electric readiness standards and update existing ordinances. These amendments align with the Electric Readiness Model Reach Code, developed collaboratively with Peninsula Clean Energy (PCE) and Silicon Valley Clean Energy (SVCE). The ordinance aims to prepare all new residential buildings, and certain major alterations, for future electric appliance installations, such as heat pumps, electric water heaters, cooktops, and clothes dryers.
Under the Town's existing ordinance, electric readiness requirements only apply to projects that increase a building’s conditioned area, volume, or size, primarily impacting newly constructed homes and expansions. Existing non-residential buildings, including commercial spaces and the Public Facilities and Schools District (PFS), fall under a separate category addressed in the current ordinance, which remains unchanged. However, the nonresidential requirements could also be revised to address new construction similarly to the new construction regulations for residential properties. There are no requirements for existing nonresidential buildings.
The amendments would broaden electric readiness requirements to apply to a wider range of projects beyond expansions—specifically, all additions and alterations requiring an electrical permit. By adjusting Section 4.106.5.2 to capture these projects, the ordinance ensures that homes undergoing significant renovations (such as kitchens, laundry rooms, or utility spaces) are equipped with necessary electrical infrastructure for future electrification. This incremental approach is both financially feasible and minimizes the burden for homeowners, as it encourages readiness at the point of renovation without mandating immediate appliance replacements. Projects requiring electrical service upgrades are exempt from this requirement, unless such upgrades are already part of the renovation.
Table 1 below outlines applicable project types, the potential Electric Readiness requirements, and the estimated cost to meet electric readiness.
Table 1: Requirements for Existing Buildings and Renovations Project Type Requirement/Description Estimated Additional Cost for Electric Readiness
Panel/Service Upgrade (part of a
larger project)
If the project includes a new
electrical panel and electrical
service upgrade, the building
electrical system shall be sized to
meet the future electric
requirements.
$0
Panel/Service Upgrade
If a homeowner upgrades their
panel, they will be required to have
electric readiness for future electric
water heating and space heaters.
$1,000 - $2,000
Kitchen Renovations
If a homeowner is upgrading their
kitchen, readiness must be provided
for a future electric cooktop, even if
the current appliance remains gaspowered.
$500 - $1,000
Laundry Room Renovations
If a homeowner is upgrading their
laundry room, readiness must be
provided for a future electric
clothes dryer.
$500 - $1,000
Utility Room Renovations
Readiness must be provided for
electric water heating and space
heaters.
$1,000 - $2,000
For new single-family and multifamily dwellings, the amendments would add requirements for Electric Readiness, in addition to the 2022 Energy Code requirements, for space heaters, water heaters, cooktops, clothes dryers, and energy storage systems.
The amendments also propose optional provisions to extend Electric Readiness requirements to new construction projects and their all gas/propane appliances, such as grills, pool heaters, and fireplaces. Although these items are currently exempt under the Energy Policy and Conservation Act (EPCA), including them in the ordinance would align with the Town's sustainability goals and promote broader environmental stewardship.
Table 2: Requirements for New Construction
Existing &
Proposed
Code
Requirement Description
Existing Reach
Code /
CALGreen
Requirements
Heat Pump Water Heater
Ready
Electrical infrastructure must be installed to accommodate a future heat pump water heater
Heat Pump Space Heater
Ready
Electrical infrastructure must be installed to support a future heat pump space heater.
Electric Cooktop Ready Electrical wiring for an electric cooktop must be provided, even if a gas cooktop is initially installed.
Electric Clothes Dryer Ready Electrical infrastructure (240V outlet) must be installed for a future electric clothes dryer.
Energy Storage System Ready Wiring and infrastructure to support a future energy storage system (e.g., battery backup) must be included.
Proposed
Reach Code
(OPTIONAL)
All Gas/Propane Appliance
Electric Readiness
Electrical readiness must be provided for all gas or propane appliances, the most common examples include:
• Outdoor Cooking Appliances (e.g., grills, BBQs)
• Pool and Spa Heating Equipment
• Indoor and Outdoor Fireplaces
Generators are exempt*
These requirements ensure that all newly constructed homes are fully prepared for future electrification, minimizing the cost and complexity of retrofitting down the line. The Council's direction is sought on whether all gas/propane appliances should remain exempt or be included in future electrification efforts.
Staff and a representative from TRC, the Town’s consultant team, are present to answer any questions the Council may have. Ultimately, the objective is to obtain Council feedback that is sufficient for staff to craft an ordinance for introduction at the November 20, 2024, Council meeting.
CONCLUSION
The proposed Ordinance amendments, centered around Electric Readiness, provide a practical approach to prepare new construction and major renovations for future electrification, in line with evolving state and regional policies. By focusing on infrastructure improvements at the earliest and least-cost stages, the Town positions itself to meet upcoming decarbonization mandates while reducing long-term retrofit costs for homeowners. The inclusion of additional electric-ready requirements for all gas/propane appliances aligns with the Town’s broader sustainability and public health goals. These measures will help ensure that Atherton is well-prepared for the state’s transition to cleaner, all-electric buildings, offering flexibility for residents and developers while promoting healthier, more energy-efficient homes.
During this meeting session, Council’s feedback on specific elements to include in the ordinance will help guide its final structure. A formal ordinance reflecting this input will be introduced in November for initial consideration and first reading, incorporating any necessary adjustments based on Council’s direction.
FISCAL IMPACT
The adoption of the Reach Code Ordinance will have minimal fiscal and resource impacts on the Town. Costs associated with implementing the new ordinance will include staff training, the development of updated informational materials, and public outreach efforts to inform residents and developers of the new requirements. These expenses are expected to be modest and can be absorbed within the Town’s existing budget allocations. No additional funding or resources are anticipated to be necessary for the successful implementation of the ordinance.
GOAL ALIGNMENT
This report and its contents are in alignment with the following Council Policy Goals:
• Goal D – Enhance Environmental Sustainability
• Goal F – Be Forward-Thinking, Well-Managed and Well-Planned
POLICY FOCUS
The Council’s direction is needed regarding the future policy consideration of outdoor gas appliances, such as grills and fireplaces, which are currently not regulated in the 2022 Energy Code). These appliances, while unregulated at the federal level, present an opportunity for the Town to address sustainability goals and align with broader electrification efforts. The Council should consider whether to maintain the current exemptions or explore including outdoor gas appliances in future electrification mandates.
PUBLIC NOTICE
Public notification was achieved by posting the agenda, with this agenda item being listed, at least 72 hours prior to the meeting in print and electronically.
ATTACHMENTS
1. Ch. 15.19 Green Building Code of the Atherton Municipal Code
2. Proposed Ordinance Language to Revise Section 15.19.030