DATE: September 8, 2025
TO: Council Sustainability Committee
FROM: Director of Public Works
Director of Development Services
SUBJECT: Potential Reach Code Amendments for the 2025 Building Code
RECOMMENDATION
That the Council Sustainability Committee (CSC) reviews this report and provides direction to staff regarding a new Reach Code.
SUMMARY
The California Building Standards Code is updated every three years and the next version, the 2025 California Building Standards Code, will take effect on January 1, 2026. Hayward’s current Reach Code was prepared and adopted specifically for the current Code, so it will expire on December 31, 2025. For Hayward to continue to make progress on reducing greenhouse gas emissions and further electrification of buildings and vehicles, Hayward will need to adopt a new Reach Code. The 2025 Code requires significantly more electric appliances, electric readiness and energy efficiency for new buildings. In addition, recent state law requires that local jurisdictions allow mixed-fuel residential construction. For these reasons, staff is not recommending adoption of any reach codes for new construction. Staff is seeking the Committee’s input on possible approaches for decarbonizing existing single-family homes. Staff recommends maintaining and re-adopting the City’s existing reach code requirements related to electric vehicle (EV) charging infrastructure.
BACKGROUND
The California Building Standards Code has 12 parts. Part 6 is the California Energy Code and Part 11 is the California Green Building Standards Code, known as CalGreen. State law allows local jurisdictions to adopt ordinances that amend the California Building Standards Code. The ordinances, usually amendments to the Energy Code and/or CalGreen, are commonly referred to as Reach Codes. Out of approximately 540 cities and counties in California, more than sixty local governments have adopted Reach Codes to encourage or require all-electric construction as well as electric vehicle charging infrastructure. Hayward adopted its first Reach Code on March 3, 2020. Hayward’s current Reach Code, as it relates to buildings, was adopted on November 15, 2022 and was re-adopted on June 6, 2023 with minor technical revisions. On June 24, 2025, the EV charging requirements in Hayward’s Reach Code were updated to be consistent with changes to CalGreen that took effect in 2024.
The purpose of Hayward’s Reach Code is to reduce the use of fossil fuels, both in buildings and in vehicles, and requires the following:
All new residential buildings, including mixed-use buildings, must be all electric.
All new non-residential buildings for which natural gas infrastructure is installed, must be “electric ready”, meaning they have the wiring, electrical capacity and space needed to be converted to an all-electric building in the future.
All new buildings, and modifications to existing buildings resulting in new parking spaces, must have electric vehicle (EV) charging infrastructure above and beyond that required by the CalGreen Code.
As reported to the CSC on March 11, 2024, staff stopped enforcing the Reach Code requirements prohibiting installation of natural gas infrastructure in new residential construction (item ‘a’ above) in January 2024. This was in response to the Ninth Circuit Court of Appeals ruling on January 2, 2024, regarding the City of Berkeley’s gas ban. Hayward has continued to enforce items ‘b’ and ‘c’.
On November 18, 2024, the CSC reviewed and unanimously recommended to the full City Council staff’s recommended amendments to the City’s EV charging requirements. During the discussion, Committee members asked how often EV ready parking spaces are voluntarily upgraded to have installed chargers. In response, staff reviewed plans and visited the sites of seven projects that were built in the last few years. Two of the seven sites had more EV chargers than were called for on the approved plans. The Depot Community Apartments, located at 2595 Depot Road, had approved plans showing two EV charging spaces. Staff visited the property and found four EV charging spaces. The Subaru dealership on Mission Boulevard had plans showing six EV charging spaces and four EV Ready spaces. Staff visited the property and found 14 spaces with chargers.
Policy Context for a New Reach Code
On January 30, 2024, the City Council adopted Hayward’s updated Climate Action Plan (CAP), which includes the following actions:
Action BE-1.2 - Adopt an ordinance, reach code, or zero NOx threshold, effective January 1, 2026, that establishes mandatory requirements that all newly constructed buildings avoid natural gas use by 2026.
Action BE-2.1 - Once costs and funding/financing options are identified (BE-2.5), adopt a decarbonization ordinance for existing single-family residential buildings by 2026 that, based on legislative feasibility, establishes mandatory requirements that eliminates expansion of natural gas infrastructure, and requires appliances, upon replacement, to be decarbonized where technologically feasible and cost effective.
Action BE-3.1 - Based on the results of the feasibility studies (BE- 3.4) adopt a decarbonization ordinance for existing commercial buildings by 2026 that, based on legislative feasibility, establishes mandatory requirements that eliminates expansion of natural gas infrastructure and requires appliances, upon replacement, to be decarbonized where technologically feasible and cost effective.
Action BE-3.2 - Based on the results of the feasibility studies (BE- 3.4) adopt a decarbonization ordinance for existing multi-family buildings by 2026 that, based on legislative feasibility, establishes mandatory requirements that eliminates expansion of natural gas infrastructure and requires appliances, upon replacement, to be decarbonized where technologically feasible and cost effective.
On June 30, 2025, Governor Gavin Newsom signed Assembly Bill 130, a trailer bill to the 2025-2026 state budget, enacting new laws aimed at accelerating and streamlining housing production. The law includes a moratorium on residential reach codes from October 1, 2025, to June 1, 2031, but includes a few exceptions. One exception allows local code amendments that align with a general plan approved on or before June 10, 2025, and that permits mixed-fuel residential construction, and is consistent with federal law, while also incentivizing all-electric construction as part of an adopted greenhouse gas emissions reduction strategy. Hayward’s CAP, adopted as part of the City’s General Plan, calls for reach codes and allows the City to adopt such codes after October 1, 2025.
The Bay Area Air District (BAAD) regulates nitric oxide (NO) and nitrogen dioxide (NO2), collectively referred to as nitrogen oxides (NOx) and adopted new rules in 2023. BAAD is currently considering adding flexibility measures to the rules, which may be considered by the Board of Directors in 2026. As currently written, the rules will require: Water Heaters – Only ultra-low NOx emission water heaters can be sold or installed in the Bay Area beginning in 2027.
Furnaces – Only ultra-low NOx furnaces can be sold or installed in the Bay Area starting in 2029.
Large Commercial Water Heaters – Only ultra-low NOx large commercial water heaters can be sold or installed in the Bay Area starting in 2031.
DISCUSSION
The 2025 Energy Code that takes effect on January 1, 2026, includes several changes that will contribute to California’s efforts to decarbonize its buildings. The updated Code is expected to provide more than $4.8 billion in estimated statewide energy cost savings over 30 years. The updated Energy Code will require:
New Single-Family Homes
Heat pumps for space heating
Heat pump water heaters
High-performance windows and walls
New Multi-Family Homes
Heat pump for water heating equipment serving individual dwelling units Electric readiness for central gas water heating systems Strengthened envelope provisions including cool roof, wall and fenestration performance Non-Residential Buildings
Heat pump standards for select nonresidential building types (when replacing single-zone rooftop units less than 65,000 Btu/h) Multizone HVAC heat pumps in most climate zones for office and school building types Heat pump water heaters in schools greater than 25,000 square feet Electric-readiness for commercial kitchens
Increased solar and storage standards for assembly buildings, including religious worship, sport, and recreation buildings New Residential and Non-Residential Buildings – The California Code becomes more stringent with each code cycle. With the 2025 Code, heat pumps and electrification electric readiness are now required for new construction in most cases. There is now less of a need for local governments to adopt reach codes for new construction. In addition, AB130 requires that local governments must allow for mixed fuel construction. For these reasons, staff is not recommending a new reach code for new buildings.
Existing Non-Residential and Large Multi-Family Buildings – As reported to the CSC on March 10, 2025, staff is exploring the possible adoption of a Building Performance Standard (BPS), which would require larger multi-family and commercial buildings to limit emissions of greenhouse gases. The California Energy Commission will soon release a Building Energy Performance Strategy Report that is expected to be a roadmap for a statewide BPS. A BPS can be an effective way to address large users of fossil gas and directly contribute to achieving the City’s long-term GHG emissions reduction goals. A BPS would require improvements and electrification based on annual reporting, so a reach code that would be triggered by a building permit would not be necessary.
Existing Single-Family Residential Buildings – There are three types of ordinances that cities and counties are adopting that apply to additions and alterations to existing single-family residential homes:
Flex Path – Requires applicants to abide by a flexible menu of energy efficiency measures, electrification measures and/or electric readiness requirements.
Menu of options includes insulation, duct sealing, air sealing, heat pumps, induction cooktops and solar.
Adds complexity to the plan check and inspection processes.
Cost-effectiveness is required and depends on home vintage. (Measures are less cost-effective in newer homes.) Compliance is estimated to cost $5,000-$15,000 and would result in an increase in project costs of approximately 2-6%.
Air Conditioner to Heat Pump (AC2HP) – When replacing an existing air conditioning system or installing new air conditioning, a heat pump (capable of cooling and heating) must be installed.
Whereas replacing a gas furnace with a heat pump might involve electric upgrades and other costs, the wiring, electrical capacity, and space to install a heat pump is already in place when installing a heat pump at the time of an air conditioner replacement.
Model ordinance allows for flexibility. Other energy conservation measures may be installed in lieu of a heat pump space heater.
Inspection process may be complex.
Requires cost effectiveness. Not cost-effective in newer homes.
Compliance cost is estimated to be $1,200 to $4,200 above the cost of air conditioning.
Electric Readiness – Applies to buildings undergoing renovation and ensures buildings are equipped with electric-ready infrastructure.
Requires pre-wiring for gas cooking, water heating, clothes drying and outdoor appliances to reduce future retrofit costs when these appliances are electrified.
Does not require cost effectiveness because the requirements do not amend the Energy Code.
Administration and enforcement would be less complex than the Flex Path or AC2HP approaches.
Compliance costs can result in an increase in project costs of approximately 3% for larger projects to 7% for smaller projects and can include:
Reserving breaker space: $0-$50
Running a new dedicated circuit: Up to $1,000 per circuit Adding conduit: Up to $1,000
Of the three options listed above, Electric Readiness is staff’s preferred approach. As detailed in Attachment II, an Electric Readiness Reach Code would apply to major additions and alterations of single-family homes. The 2025 California Energy Code requires the construction of new mixed-fuel single family buildings to include “electric ready” components, including electric outlets near natural gas appliances. This includes clothes dryers, cooktops, gas-fueled furnaces and gas-fueled water heaters, including reserved breakers in the electrical panel for a future electric appliance. However, the Energy Code does not require electric-ready components for renovations, remodels, and additions.
Electric readiness requirements would focus on pre-wiring for gas cooking, water heating, clothes drying and outdoor appliances to reduce future retrofit costs when these appliances are electrified. A detailed list of potential requirements as well as potential exceptions are included in Attachment II. Compliance with an electric readiness ordinance would require less incremental cost than other types of reach codes. The policy will also prepare homes for compliance with Bay Area Air District’s rules, which limit the sale of natural gas-fueled building appliances.
EV Charging Infrastructure – The ordinance adopted by the City Council on June 24, 2025, requires more EV charging infrastructure than the CalGreen standards that will take effect on January 1, 2026. Maintaining the City’s current EV charging requirements will require adoption of a new ordinance referencing the 2025 CalGreen. Staff does not recommend any changes to the existing requirements.
ECONOMIC IMPACT
As noted above, an electric readiness ordinance would increase the initial cost of additions and remodel projects, however the additional costs are expected to be low compared to the typical initial cost of tens of thousands of dollars for major additions and alterations. Electric readiness requirements would avoid the need for stand-alone electrical upgrades in the future and would save homeowners money when installation of electric appliances is required.
FISCAL IMPACT
Adoption of a new Reach Code will not result in an impact to the General Fund. Staff is seeking to develop an ordinance that is straightforward and simple to enforce in an effort to minimize impacts on City staff workflows and workloads.
STRATEGIC ROADMAP
This agenda item supports the Strategic Priority to Champion Climate Resilience & Environmental Justice, and specifically relates to implementation of the following Project under that heading:
Reduce Greenhouse Gases and Dependency on Fossil Fuels:
Project CP1: Implement Year 1 Programs from the adopted GHG Roadmap(Climate Action Plan).
SUSTAINABILITY FEATURES
A new Reach Code can help limit the use of natural gas in new and existing buildings, which is a key strategy for meeting the City’s long term GHG reduction goals. These goals include:
30% below 2005 levels by 2025
55% below 2005 levels by 2030
work with the community to develop a plan that may result in the reduction of community based GHG emissions to achieve carbon neutrality by 2045
PUBLIC CONTACT
Staff sent an email to builders and developers to let them know about the proposed amendments and this CSC meeting. Staff will summarize responses during the meeting.
NEXT STEPS
Upon direction from the Committee, staff will conduct additional research and outreach and may prepare an amended Reach Code incorporating the Committee’s comments. Many other cities in the Bay Area are currently exploring new potential reach codes. Staff is in touch with several cities and will share information about those cities during the September 8 meeting and at future meetings. Staff anticipates returning to the Committee in November or January with more information.
Prepared by: Erik Pearson, Environmental Services Manager Recommended by: Alex Ameri, Director of Public Works
Sara Buizer, AICP, Development Services Director
Approved by:
______________________________________________
Jayanti Addleman, Interim City Manager
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