A federal judge has upheld a rule by the South Coast Air Quality Management District that would prohibit the use of gas-powered appliances, such as water heaters and boilers, in much of Southern California, rejecting arguments that the regulation is preempted by federal law.

In a decision issued over the weekend, U.S. District Judge Percy Anderson concluded that the U.S. Ninth Circuit Court of Appeals’ 2024 ruling in California Restaurant Association v. City of Berkeley did not apply to the South Coast rule, as the Berkeley case addressed a local ordinance that banned the installation of gas piping in new buildings. The court interpreted the Berkeley decision narrowly, suggesting its reasoning was limited to the specific facts of that case.

This weekend’s court ruling addresses the existing Rule 1146.2, which differs from a separate residential gas ban proposal that CAA helped defeat in June. That proposal, which would have phased out gas-powered furnaces and residential water heaters, was rejected by the Air Quality District’s governing board in a 7-5 vote following strong opposition from housing providers.

The California Apartment Association, which is among the plaintiffs challenging the rule, disagrees with the judge’s interpretation of the Berkeley decision and is reviewing options for contesting the ruling.

CAA had argued that the South Coast rule—known as Rule 1146.2—violates the federal Energy Policy and Conservation Act. That law prohibits local and state regulations that amount to bans on appliances covered by federal energy efficiency standards, including many gas-fired water heaters and boilers used in apartment communities.

The association and its coalition partners had sought to overturn the rule through a motion for summary judgment. The court denied that motion and instead granted the Air Quality District’s cross-motion for summary judgment.

Rule 1146.2, amended following a public hearing on June 7, 2024, requires the eventual phase-out of covered appliances in buildings throughout the South Coast region, affecting rental housing providers and other property owners across Los Angeles, Orange, Riverside and San Bernardino counties. Compliance deadlines vary, with requirements for new buildings beginning in 2026 and for existing buildings starting in 2029. The rule’s “zero NOx” requirement effectively bans most gas-powered units, making electric appliances the only practical option for compliance.