Sacramento moves forward plan requiring new buildings to run on 100% electricity

Sacramento is continuing work on its plan to require new buildings to run entirely on electricity.

On Tuesday, the City Council updated an ordinance with this requirement and also approved new fees for developers that want to apply for exemptions. 

First passed last year, the ordinance requires newly constructed residential and commercial buildings with three stories or fewer to be all-electric starting in 2023. Applications for new high-rise buildings must meet the same standard beginning in 2026, with few exceptions allowing gas power. 

But some business owners pushed back against the plan.

Kevin Fat, a panel representative and CEO of the Fat Family Restaurant Group, raised concerns over the new fees associated with applying for the waiver and appealing a rejection. Fat told the council the fees, which range from about $500 to $1,600, would add financial burden.

“I believe this will create an unfair economic disadvantage, especially for future small and minority-owned restaurants that require gas to cook their cuisines, to operate within the city of Sacramento,” Fat said. “Technology for certain ethnic-style cooking, especially wok cooking, is still not ready for prime-time.” 

Supporters say the ordinance will help the city reach its goal of carbon neutrality by 2045. Natural gas makes up 15% of the city’s greenhouse gas emissions, staff said during the meeting. The Mayors’ Commission on Climate Change also recommended Sacramento mandate new buildings be built to use all-electric power in its 2020 report. 

The council unanimously updated the ordinance to align with the latest California Building Standards Code. It also greenlit criteria for builders to get the requirement waived if they prove all-electric power is infeasible for parts of developments. A 14 member advisory panel — including representatives from the housing, manufacturing and restaurant industries — gave input on the process for waivers. 

City officials approved the waiver process and fees in addition to three limited exemptions, which were listed in the initial and updated ordinance. Developers are exempt from all-electric requirements through the end of 2025 for ground floor restaurant cooking equipment, certain manufacturing equipment in industrial facilities and water heating in regulated affordable housing. 

The three specific exemptions will continue until technology for all-electric alternatives are readily available, according to the ordinance. Those developers won’t need to apply for and pay waiver fees during the exemption, according to the guidelines. 

Situations where developers might qualify for an infeasibility waiver include if the building needs gas power during a power outage or if electric equipment isn’t commercially available. 

Council Member Katie Valenzuela said that, outside of the exemptions, the city doesn’t plan to slow down on electrification. The ordinance doesn’t apply to existing buildings, but she said the issues will intertwine.

“As much as I don’t want our restaurants to be harmed, I’m also not OK with the fact that some restaurants will be left on a system that will become more expensive and more dangerous as time progresses,” Valenzuela said.

Studies have shown household gas appliances produce indoor and outdoor air pollution that harms public health. A 2020 UCLA study found gas appliances emit pollutants such as carbon monoxide and particulate matter, which have been tied to health issues such as respiratory illnesses. The Sacramento region has the seventh worst short-term particle pollution in the nation, according to the American Lung Association’s 2022 State of the Air Report. 

Only one home building representative brought concerns to the council in public comments Tuesday. Jeff Short, legislative director of the North State Building Industry Association, said data suggests about 7% of new housing built in Sacramento runs entirely on electricity. He added the association plans to watch whether the ordinance disrupts building housing and will alert the city if this is the case. 

“We have real concerns regarding the availability of new component parts due to ongoing international supply chain shortages, as well as with potential cost increases that may develop for consumers once a hard deadline for all-electric components is adopted,” Short said. 

The council will need to update the ordinance again before 2026, when a new, three-year-long state building code will go into effect. 

More information on the new building electrification ordinance is available on the city’s website.