Berkeley Policy Aims to Cut Pollution From Homes, and Targets the Moment You Sell (or Buy)

Berkeley’s City Council approved updates to a policy this week intended to slash planet-warming pollution that comes from buildings.

If homes do not meet certain efficiency requirements at the time of sale, outgoing and incoming homeowners put money toward upgrades like swapping out a gas furnace for an electric heat pump, adding insulation, or installing solar panels. The buyer is then tasked with completing upgrades and will be reimbursed for those funds once complete.

“I’m just really proud of our city council for being able to make this decision,” Berkeley Mayor Adena Ishii said. “The goal at the end of the day is that people are able to make the changes to their homes that will make them more climate-friendly.”

The ordinance is intended not only to reduce gases that heat the climate, but also those that pollute indoor spaces. A move toward greater efficiency can also reduce energy bills.

The policy will apply to one- to four-unit homes, of which there are roughly 29,000 in Berkeley, according to the city. City representatives said about 700 are sold each year.

“No one’s done something quite like this before,” said Ammon Reagan, sustainability program coordinator for the city of Berkeley. Reagan, along with others in the building efficiency space, called the policy a “first-of-its-kind.”

“The time of sale is a great trigger point because many homes complete upgrades when a home sells,” Reagan, who manages the building emission savings ordinance, said. “And we want to ensure that those renovations include resilience measures and electric systems because those systems will be in their home for another 15–20 years.”

“We’ve seen the effects of climate change, and our homes need to be more resilient in order to weather future climate events,” Reagan said.

The policy amends the current Building Emissions Saving Ordinance, which asked homeowners to make energy-efficiency upgrades on a voluntary basis.

The new code (PDF) requires upgrades, which can be done up to five years prior to a sale. Homeowners can choose from a variety of upgrades to a home, or instead make a $2,500 deposit that will be held in escrow. If that happens, the buyer must match that $2,500 deposit and then use those funds to improve their building’s efficiency. If they fail to do so within two years, the money will be used by the city for low-income electrification programs.

The cheapest, simplest way to comply would be to install a heat pump water heater, according to the city, which estimated the average cost to do so in Alameda County is $6,700–$7,900. There are also tax credits and rebates to bring down this price.

There are exemptions for first-time homebuyers that meet certain income qualifications, condominiums and accessory dwelling units, and homes that already show high energy efficiency, like if the home already has a heat pump system.

City representatives said the measure is intended to help Berkeley homeowners prepare for new requirements from the Bay Area Air District, which will prohibit the sale and installation of gas-powered water heaters and furnaces starting in 2027.

The new rules will begin on Jan. 1, 2026, for one- and two-unit residential buildings and in 2028 for three- and four-unit buildings.