September 8, 2025
RE: Agenda Item #6.2 - Reach Codes - SUPPORT
Dear Mayor Mahan, Vice Mayor Foley, and Councilmembers,
On behalf of the U.S. Green Building Council California, I write in strong support of adoption of the 2025 CALGreen reach code to encourage that all air conditioning (AC) replacements in single-family homes include both cooling and heating modes, as well as the electric readiness reach code.
USGBC California’s members are designers, engineers, public agency and utility staff, consultants, product manufacturers, and service providers. Our mission is to transform California through the built environment into a more sustainable, resilient, and equitable place for all.
Two-way ACs, commonly known as heat pumps, reduce climate pollution and lower energy costs. The proposed policy, often referred to as an air conditioner to heat pump replacement policy or “AC2HP” code, is in line with San José’s sustainability goals. With available incentives, the upfront cost of a heat pump is equivalent to AC replacement and their superior efficiency can provide monthly bill savings, making this policy a win-win for San José.
Heat Pumps Reduce Greenhouse Gas Emissions and Air Pollution AC2HP policies not only incentivize appliances with twice the functionality of conventional air conditioning units, they also help to offset or completely eliminate the use and future replacement of fossil fuel powered furnaces, because heat pumps can both heat and cool homes. A heat pump with a backup furnace uses about 95% less gas compared to a conventional air conditioner paired with a gas furnace. Greenhouse gas emissions are reduced significantly in the first year, and over the life of the appliance, emissions will continue to decline toward zero as the electric grid is decarbonized.
Beyond just greenhouse gas emission reductions, heat pumps also eliminate harmful indoor and outdoor nitrogen oxides (NOx), which cause smog. This local air pollution worsens many health conditions, such as asthma. Malfunctioning gas furnaces can also cause fatal carbon monoxide poisoning.
AC2HP Policies Save Households Money
The best time for households to switch to a heat pump is when they need to replace their air conditioner. This is because an existing AC system has the necessary electric wiring and capacity in place to allow for a drop-in replacement with a heat pump.
The California Green Building Council dba USGBC California is a nonprofit 501c(3) charity EIN#75-3041444
1 September 8, 2025
TO: Honorable Mayor Matt Mahan, Vice Mayor Foley, and City Councilmembers:
SUBJECT: 9.9.2025 City Council Agenda Item #6.2: Support: Existing Single-Family Building Reach Code - Mayor Matt Mahan and Councilmembers Cohen, Candelas and Tordillos
9.5.2025 Memorandum - Staff recommendation Alternative #1: Adopt the AC to Heat Pump requirement as Reach Code and directions to the City Manager We are San José Community Energy Advocates and Climate Reality Project - Silicon Valley, both volunteer community groups that advocate for renewable energy and reducing GHGs. We appreciate Staff’s efforts to electrify San Jose’s existing single-family buildings, with Council’s support.
We strongly request that the City Council approve the full reach code proposed by staff as described in the July 21st memorandum (Staff Memorandum) and September 4 Supplemental Memorandum from the Energy Department Director Lori Mitchell, along with the four other recommendations posed in the September 5th memorandum shared by Mayor Matt Mahan and City Councilmembers David Cohen, Domingo Candelas and Anthony Tordillos (Mayor’s Memorandum). In lieu of passage of the full reach code, approving Alternative #1 would be a minimum acceptable approach that could still deliver some worthwhile emissions reductions.
As the 12th largest city in the United States, we recognize the vital role San Jose plays in defending the climate. To continue its climate leadership, Council should approve the full reach code proposed by staff. As a fallback, we ask Council to approve staff’s Alternative #1 as outlined in the Mayor’s Memorandum, so we can maintain and improve the reduction of GHGs from single-family buildings.
Alternative #1 is the first alternative analysis suggested by the Energy Department. It requires, when a resident wants to replace or add air conditioning (AC), they follow one of two pathways:
Pathway 1: Install a heat pump HVAC system (cooling + heating) and meet state standards OR
Pathway 2: Install a standard AC (cooling only) alongside an existing gas furnace and make other energy efficiency improvements above the state standards.
2 Pros:
● It gives residents a choice how they wish to comply with the code: they can EITHER install a heat pump HVAC system OR, if they choose, they can keep their existing gas furnace and install a standard AC (cooling only) as long as they make some energy efficiency improvements above state standards.
● It would set up residents to be prepared to comply with future Bay Area air quality district regulations.
● It would include the portion of the reach code that has more quantifiable GHG reduction impacts.
● Residents who choose Pathway 1 will benefit from cleaner indoor air and more energy- efficient homes, and saving money on their energy bills. ● It has been shown to be cost effective through state approved studies. ● It provides reasonable exceptions from the requirement in certain situations to avoid adding a financial burden.
● It only applies to residents who earn at least 100% of the Santa Clara County Area Median Income (see below)
Cons:
● Alternative #1 only boosts the electrification and improved efficiency of space heating and cooling and would not have an impact on natural gas use in other appliances. ● Alternative #1 misses an opportunity for homes to be future-proofed for other electric appliances during home remodels.
In addition to strengthening our reach codes with staff recommendation Alternative #1, the Supplemental Memorandum emphasizes the importance of equity by offering an exemption for those households that earn less than 100% of the Santa Clara County Area Median Income.
For San Jose residents, this means that those households earning $184,300 or less per year for a family of four are exempt.1 Furthermore, San Jose Clean Energy offers heat pump rebates which can cover the incremental cost ($3500 for lower income residents who live in Environmental Justice Communities; $2500 for all other households regardless of income or neighborhood). The Mayor’s Memorandum also emphasizes the importance of education and community outreach, which we recognize is important for any program that requires the action of homeowners and contractors.
We see this as a valuable step forward that is essential at this time not only to reach our stated climate emission reduction goals, but also to prepare for the Bay Area Air District’s requirement that by 2029, no gas-fired furnaces can be sold or installed in its region. In reality, the Staff Memorandum incentivizes our homeowners who chose to remodel their space heating and
1 Area Median Income & Eligibility for Affordable Housing - SV@Home:
https://siliconvalleyathome.org/resources/finding-affordable- housing/#:~:text=The%20area%20median%20income%20(AMI,increase%20of%20$44%2C000%20since %202021
September 9, 2025
Re: Support 9.9.25 Agenda Item #6.2: Approve BOTH Proposed Reach Codes
Honorable Mayor Mahan, Vice Mayor Foley, and City Councilmembers Kamei, Campos, Tordillos, Cohen, Ortiz, Mulcahy, Doan, Candelas, Foley, and Casey:
Mothers Out Front Silicon Valley—a grassroots, volunteer group of 2500+ parents, youth and allies—advocates for a healthy environment today and a livable climate tomorrow for all children. Over the past nine years, we’ve proudly supported San Jose’s climate leadership, from creating the nation’s largest Community Choice Aggregation program (now SJCE) in 2017 to ensuring that all residents of new apartments and condos have access to charging in 2024. Now we ask you to continue that leadership and approve BOTH ordinances in staff’s proposed Existing Single-Family Building Reach Code.
We know that you have received negative messaging, led in part by the Santa Clara County Association of Realtors (SCCAOR) who are opposed to San Jose adopting any updated reach code at all. We ask that you carefully examine these arguments and weigh them against the evidence. To assist, here is a summary of arguments made by SCCAOR and Councilmembers Foley and Casey and a correction of misinformation/ exaggerations.
CLAIMS ABOUT PROPOSED
REACH CODE
THE FACTS
1. “Homeowners replacing
their AC Unit are prohibited
from purchasing another AC
Unit, forcing them to purchase
a heat pump.”
This is false. The AC to heat pump ordinance is
NOT an “AC ban.” Rather, through Pathway #1, it
incentivizes (but does NOT require) homeowners
who wish to install or reinstall an AC to swap an
existing gas furnace with a heat pump (which
provides both heating and cooling). Homeowners
who wish to retain their existing gas furnace and
install a traditional AC unit ARE ALLOWED to do so
(Pathway #2), as long as they add additional energy
efficiency measures— which will save them money
on their energy bills beginning day one.
2. “Any time an electrical
permit is pulled in the City of
San Jose, if there is a gas
appliance in proximity, the
room must be made
‘all-electric ready.’”
This is misleading. This electric readiness
ordinance only applies to existing single-family
homes doing an alteration or addition (not to ANY
electrical permit). If a homeowner CHOOSES to
replace the gas appliances with electric ones, they’re
not required to make the rest of the room “all-electric ready.” Rather, a conduit must be added to make any
gas appliances within 3 feet electric ready.
3. “The Reach Code…will be
extremely expensive for San
Jose residents who are
already attempting to perform
a renovation of their home,
which is already a costly
endeavor.”
This is exaggerated. According to Staff analysis
(see FAQ #1), the incremental upfront cost of the AC
to Heat Pump pathway is estimated at $652-
$1,670 for the average installation (a fraction of the
cost of the overall project). In order to cover this
incremental cost, SJCE provides heat-pump rebates
of $2,500 for all households regardless of income;
households meeting lower income thresholds can
receive rebates of $3,500—though they are likely
exempt from the reach code altogether (see below).
Therefore, staff state that, “Currently available
rebates are able to cover the full amount of these
estimated incremental upfront costs.” If a resident
elects to install a high-efficiency heat pump, the
average incremental cost is around $3600, so after
applying the SJCE rebate, the project may cost $100
to $1100 more (~0.5% to 6% of total project
cost)—which they’ll easily recoup in energy bill
savings in the first year after installation.
Residential SJCE customers also qualify for the
EcoHome Payment Plan, which provides zero-
interest loans for heat pumps that are repaid on-bill.
Loan terms are for 2, 3, or 5 years, up to $5,000.
To minimize any financial burden, there are several
exemptions. The reach code would NOT apply to:
• households earning less than 100% of the area
median income which is currently $184,300 for a
family of four (see Supplemental Memo)
• projects requiring a panel or service upgrade
• when there are other technical exceptions
There are also up to $4,000 in additional incentives
available for residential heat pump HVAC
installations via the TECH Clean CA program.
Bottom line: If a homeowner can afford to
install/reinstall HVAC equipment, they almost
certainly can afford to install a heat pump (pathway
#1) or additional efficiency measures (pathway
#2)—and any additional costs will be quickly
recouped through reduced energy bills.
4. “As small an issue as
pulling an electrical permit to
move a plug could require
extensive updates that cost
thousands of dollars.”
This is overstated. It’s very rare for a resident
simply moving a plug to pull a permit, and the
readiness ordinance would only apply to alterations
within 3 feet of a gas appliance. The exceptions
would likely cover situations like this. For example, if a homeowner has an old kitchen without GCFI plugs
and pulls a permit to modernize the plugs, that
wouldn’t trigger the electric readiness requirement
since there is an exception for repair/safety
improvements. The intention of the readiness code
is to incentivize a homeowner doing an optional
remodel that already incurs significant cost to take
advantage of the opportunity (with dry wall opened
up and contractors hired) to add electric readiness
for a marginal extra cost, covered by rebates, at the
least expensive time to do so.
5. “San Jose is already one of
the most expensive cities in
the nation - mandates like this
one are precisely why it’s so
expensive to build a home or
rent an apartment in San
Jose.”
This is a gross simplification and a confusion of
correlation and causation. The reasons for San
Jose’s high home prices and rents are very
complicated and multifactored, including the
prevalence of high earners willing to pay more, the
shortage of homes, and the desirability of this area
and our climate. This reach code ordinance would
have negligible (if any) effect on housing and jobs.
Since it only applies to EXISTING homes, it would
NOT make it more expensive to build a home in SJ.
6. “This reach code is an
unacceptable overreach of
local government. In an
attempt to ban gas, the City
Council is banning an electric
AC unit.”
This is false. To the contrary, California and many
other states have a long tradition of empowering
local jurisdictions to take action to protect their
residents. SB 130 was an unacceptable preemption
of local control, as explained by Councilmember
David Cohen in this terrific op-ed. Again, the City is
NOT banning electric AC units (see Claim #1 above).
7. “The City is trying to force
this Reach Code through at
the expense of homeowners’
right before the State’s
moratorium on local Reach
Codes for 6 years - October
1.”
There is nothing wrong with this timing. Building
codes are intended to be continuously updated. A
main reason the code is being updated now is to
align with the implementation of the updated state
building codes on Jan. 1, 2025. Fortunately, due to a
wise exception to SB 130, San Jose MAY be able to
adopt future reach code updates before 2031 IF
they’ll help reach the goals of our climate smart plan.
8. “Adoption would undermine
state housing streamlining
efforts (AB 130)” (according to
CM Casey).
This is misleading. AB 130 contains an exception
that explicitly allows cities to continue to adopt
reach codes if part of “an adopted greenhouse gas
emissions reductions strategy.” See Claims 6 & 7.
9. “Adoption would grossly
underestimate actual
compliance costs to SJ
residents” (according to CM
Casey).
This is not true. Alterations/additions incur
significant costs regardless. Installing/replacing AC is expensive, too. Staff analysis does not include the
cost of adding condensation drains or replacing
drywall because those costs would be incurred for
both a standard AC OR a heat pump. The only costs
that matter when comparing costs with or without the
reach code are additional costs that would not be
incurred by installing a standard AC. As in Claim #3,
the additional cost is minimal, covered by rebates
and quickly recouped through energy savings.
10. “Electrification and building
efficiency standards make
sense for new construction.
However…[we should not]
apply these standards to
existing single-family homes”
(according to CM Foley).
This contradicts San Jose’s approved strategy.
Decarbonizing existing homes is an essential step in
decarbonizing our city. Gas use in buildings is
second only to transportation as the top cause of
climate pollution in San José, and 43% of these
emissions come from residential “natural” fossil gas.
In 2022, Council (including CM Foley) adopted the
Electrify San José: Framework for Existing Building
Electrification which clearly explains that
decarbonizing existing buildings is essential to
achieving San José’s climate protection goals.
11. “Adoption would fail to
deliver meaningful climate
benefits” (according to CM
Casey).
“The proposed ordinance
would result in about a 0.1%
reduction in communitywide
This doesn’t make sense. There is no magic bullet
(except a pandemic where everyone stays home)
that will take a big dent out of our GHG emissions. To
reach carbon neutrality, we’ll need to take a LOT of
small incremental steps. Each of these pieces of the
puzzle is urgently needed. The City’s latest GHG
inventory revealed that, rather than decreasing as
needed, emissions from “natural” (fossil) gas in
greenhouse gas emissions
compared to 2023 levels…
Such a small GHG emissions
reduction does not justify the
inevitable financial and quality
of life impacts to residents”
(according to CM Foley).
San Jose alarmingly increased 0.2% over the past
two years. Blocking these proposed reach codes
would slow down our progress to reduce emissions
and threaten the achievement of climate neutrality by
2030. It would also set a poor example for other
cities who look to San José for climate leadership.
Again, any financial impacts to homeowners from the
proposed ordinances are minimal (and they’ll
actually save money on their energy bills) and their
quality of life will be improved with cleaner indoor
and outdoor air and quieter appliances.
Please listen to facts, not hype. As the must-read letter from the U.S. Green Building Council explains, “With these reach codes, you have the opportunity to help San José residents save money by avoiding costly mistakes when replacing their AC or renovating their home.” Both reach code ordinances are also essential parts of San Jose’s commitment to achieving carbon neutrality by 2030—less than five years away.
If we fall short of this target, our children will pay the price. In 2024, the planet exceeded the 1.5° C climate threshold for the first time, a major red flag that at least nine irreversible tipping points are fast approaching. With the federal government now actively undermining climate action, it’s imperative that the City take every possible measure to protect our children and vulnerable communities from growing climate threats, including drought, wildfires, super storms, sea level rise, and extreme heat, along with air pollution that increases asthma and other life-shortening diseases. We must do more to reduce pollution and expand access to health-protective solutions—and that requires electrifying our homes and increasing the Climate Smart budget to provide more incentives.
The good news is, San José residents overwhelmingly want you to act ambitiously on climate, as reflected in the dozens of letters from the public supporting the reach codes. In addition, the graphs below from the Yale Program on Climate Change Communication show that 76% (3 out of 4) of Santa Clara County residents are worried about global warming and 63% (two out of three) of residents want local government officials (that’s you!) to do more. As the planet warms dangerously, the time is NOW to listen to your constituents—especially the youth—and do everything within your power to ensure a healthy and livable climate for our children and communities.
Fortunately, the proposed reach codes are a win/win: they’ll reduce energy bills, improve air quality, and get our homes future-ready while also helping address the second leading cause of climate pollution in our city: fossil gas use in buildings.
Therefore, we ask that you prioritize our health, safety, pocketbooks and climate stability and approve BOTH proposed ordinances. Should you fail to achieve that, at least approve Alternative #1 as supported by Mayor Mahan and Councilmembers Cohen, Candelas and Tordillos. Please don’t cede San Jose’s proud climate leadership to other cities. As the Capitol of Silicon Valley, let’s continue to lead the way to a healthy environ- ment, a decarbonized city, and a stable climate for all by adopting both proposed codes.
For our children,
Linda Hutchins-Knowles, Co-founder and Team Coordinator Mothers Out Front Silicon Valley / Madres al Frente de Silicon Valley