All hail the heat pump! It’s highly energy-efficient. It heats and cools buildings. It reduces greenhouse gases and improves indoor and outdoor air quality when replacing gas appliances. And those are only some of its benefits. Sold! But wait — you need a permit to install one. And getting that permit will not be easy according to SPUR’s latest policy brief, Greenlighting Clean Heat: Modernizing Permits for Heat Pumps. Author Sam Fishman, SPUR’s sustainability and resilience policy manager, lists the challenges as follows: complex and sometimes contradictory requirements, restrictive zoning and planning codes, excessive documentation requiring specialized subcontractors, multiple permits, unpredictable inspection processes, and high and variable fee structures. We asked Sam to explain current permitting headaches and walk us through how permitting reform can smooth the way to a gas-free future for buildings.
Let’s start at the beginning: What are heat pumps, and why are we talking about them?
Heat pumps are electric compressor-driven systems, like the systems used in refrigerators or air conditioners, that can move heat efficiently from a “source” to a “sink” by raising the temperature of that heat and releasing it to the destination. One of the neat things about them is that they can replace two appliances: your heater and your air conditioner.
I think your other question should be, Why are we talking about heat pumps here in California? Many households in the Southeast and other parts of the country were built out with electrical instead of gas infrastructure, so they’ve had heat pumps for decades. Even in cold-weather states like Maine, heat pumps have become the norm. But in California, where we have mainly gas infrastructure, heat pumps, have been more of a novelty. That’s changing. As the state looks to electrify homes and other buildings to transition away from gas and meet climate goals, heat pumps will become a go-to appliance.
So the state is telling consumers to replace their gas appliances with electric appliances?
Not exactly. It’s nudging consumers to replace gas water and heating appliances that are at the end of their useful lives with high-efficiency, zero-emission equipment like heat pumps. Zero-emission appliance rules, building codes, building performance standards, rebates, full-service installation programs, and climate action plans are pushing the heating appliance market and consumers toward a gas-free future for buildings. In the Bay Area, the sale of gas appliances will be phased out in the next five years, so if your gas water heater or gas furnace dies in, say, 2030, you’ll likely replace it with a heat pump model.
And that’s a good thing. We know that gas appliances don’t just emit planet-warming gases — they also emit health-harming gases, even when they’re not turned on. So switching to electric appliances produces an immediate health benefit.
And that brings us to how easy — or hard — it is to make the switch. Your research suggests that contractors and consumers face some pretty daunting challenges.
True. In the Bay Area, cities are key actors in the gas-to-electric transition. They have to prepare their planning ordinances, permitting processes, and local codes to encourage this switch.
Right now, the Bay Area’s 101 cities operate under a patchwork of permitting and inspection processes that vary significantly. Many of these jurisdictions have done little to update their processes to accommodate heat pumps and other electric equipment. The process is often cumbersome, requiring installers to subcontract various work, endure long wait times, and navigate complex and sometimes contradictory requirements to install a single home appliance. These requirements incentivize contractors to sidestep permitting.
Can you describe some permitting hurdles and their consequences for contractors and homeowners?
A lot of what makes permitting so frustrating is restrictive local zoning planning codes. Common split-system heat pump HVAC compressors must be located outdoors, typically in side yards. In many cities, mechanical equipment like compressors must be five or more feet away from detached single-family homes. Heat pump water heaters are sometimes also placed in sheds or in garages, where additional planning or building code requirements can restrict placement.
One contractor cited an attempt to install a heat pump water heater in a city where zoning required mechanical equipment to be 6 feet from the property line. In this case, that would require extensive plumbing work and add $10,000 in costs. In another city, a contractor was told by an inspector that heat pump water heaters could not be installed outdoors. That’s just not true.
Another hurdle in the Bay Area is noise ordinances. Some include decibel limits that effectively prohibit installation of common heat pump models. Some cities require sound engineering studies to verify compliance with their 50-decibel noise limit at the property line. One contractor quoted a cost of $1,200 to $1,800 to get a sound engineer to write a letter signing off on heat pump installations.
Your brief also describes excessive documentation. What are we talking about?
To meet local zoning rules, building officials often require contractors to obtain professionally drawn architectural site maps of the entire property. If building officials reject these site maps, contractors may need to re-site the equipment and re-start the application process. Often planning documents require installers to hire an architectural professional or engineer, which can add thousands of dollars in costs to a project.
Plan checks are important for big projects like new construction or home additions — but they can be overkill for straightforward equipment replacements, especially when the setup stays in the same spot and still requires an inspection. Most contractors already aim to meet code to avoid costly corrections later.
Even small electrical updates can trigger detailed permit requirements, like line diagrams showing every connection, which can feel excessive for a simple job. On top of that, some cities ask for extra paperwork — like California’s Title 24 forms — just to confirm that replacing an old gas heater with a more efficient heat pump won’t increase energy use (which it won’t).
Aren’t these overlapping requirements disincentivizing heat pump adoption?
Well, they certainly frustrate both homeowners and contractors. They drive up costs, delay projects, and complicate hiring. Even though the state has said licensed plumbers (C36) are allowed to handle the electrical hookup for heat pump water heaters, most local governments don’t seem to know this. As a result, plumbers are largely shut out of the market. Data on contractors who accessed state incentives show that only 9 of 715 recent installations were done by plumbers alone. If cities accepted the state’s guidance and removed unnecessary permit requirements, more plumbers could install HPWHs, boosting competition and helping meet demand.
Variances between cities are another issue your research uncovered. How do they affect contractors working in multiple locations?
Heat pump installation rules vary from city to city, creating a patchwork of inconsistent requirements. This jurisdictional variance makes it tough for contractors to operate efficiently — especially when trying to train new staff. One contractor shared that onboarding workers takes much longer than it should because they have to learn the specific permitting and inspection rules for each city.
It’s not just city-to-city differences that cause problems — within the same jurisdiction, plan checkers and inspectors can apply different standards. In one case, a contractor installed a heat pump water heater in an attic. The first inspector required a dam to be installed under the unit. A second inspector said the installed dam had to be replaced by a vent.
With such unpredictable and shifting requirements, contractors often enter a project not knowing what standards they'll need to meet. The result is weeks or even months of permit limbo while contractors go back and forth with city staff trying to understand what’s needed. These delays are a major barrier to scaling up clean energy solutions across the region.
What about permitting and inspection costs, which homeowners must know about in order to budget for the switch?
Permit fees for heat pumps are all over the map. Some cities charge flat rates, others stack on fees for extra work or base them on project cost — so the final price can swing wildly. Contractors eat the cost or pass it on to homeowners.
One Bay Area installer got hit with $1,110 in fees after the city canceled the permit mid-project and demanded extra paperwork — paperwork not required for gas systems. These kinds of inconsistent, high-cost processes make clean electric upgrades harder and less appealing than fossil fuel options. Streamlining and standardizing the process — or even offering instant permitting — could cut fees, save time, and level the playing field.
As a result of costs and confusion, there’s circumvention of permitting. How big of a problem is it?
A 2019 California Public Utilities Commission report found just one-third of HVAC changeouts had permits, and SPUR found most jurisdictions fall below 20% in permitting compliance, with many in the 5% to 10% compliance range.
This lack of compliance suggests the current permitting system is too complex and too slow to follow. If compliance is this poor, policymakers should reassess what permitting can realistically achieve. While inspections help ensure safety, they may not be the best tool for ensuring efficiency — especially given that a CPUC study found no energy difference between permitted and unpermitted HVAC installs.
One major barrier is urgency. Heating systems often fail unexpectedly, and long permit timelines don't match this reality. Cities should consider allowing installations to proceed with post-installation inspections for compliance.
To boost permit rates, reform is essential. After San José streamlined solar permitting, it saw a 600% boost in permit approvals in a year, suggesting simpler systems can lead to much higher compliance.
One of the really disappointing aspects of the permitting process is that it penalizes the households least able to make the switch.
Permit red tape hits hardest for people using rebates, loans, or decarbonization programs because these incentives often require permits. With $234 million in Bay Area decarbonization funding expected by 2025, much of it tied to heat pump permits, fixing permitting is key to making these dollars count.
Even for households not relying on public funds, costs could be a real hit.
Heat pump costs include both “hard” costs — equipment and labor — and “soft” costs — permitting, legal, and logistical expenses. Soft costs — like permitting delays and compliance — can significantly inflate prices, especially in places with poor permitting processes.
For solar, soft costs can make up 64% of total costs, and better permitting has cut installation time by up to 24 days and costs by up to 6%. Similar data for heat pumps is limited, but anecdotal evidence suggests permitting alone can add around 7% to project costs — about $2,173 per installation in some Alameda County cities. Better permitting could reduce these costs and speed up adoption.
If government wants to encourage the uptake of electric appliances, why does it make them so much harder to get installed than gas appliances?
California’s building codes were written for gas appliances in the 1970s and haven’t been updated for modern electric heat pumps, which are far safer. As a result, outdated safety rules are often misapplied to heat pumps, even though they don’t carry combustion risks or emit toxic gases.
Electric heat pumps don’t spark, don’t need venting, and pose little danger if bumped or toppled — yet they’re still treated like gas appliances in permitting and inspections. This slows adoption and adds unnecessary cost.
I’d also hypothesize that building departments aren’t always thinking about the larger market and policy environment that they operate in. The focus often appears to be narrowly on ensuring maximum compliance for each individual appliance installation. That is their core responsibility, and it’s hard to fault, say, inspectors, for not thinking about the heat pump marketplace. However, without reform, the perfect can quickly become the enemy of the good. A wider market and climate-literate perspective needs to enter into the picture to truly achieve public health and safety goals.
Switching to electric heat pump systems is part of a broader safety shift — protecting homes, neighborhoods, and the climate. To unlock these benefits at scale, we need updated codes, streamlined permits, and policies that reflect the actual risks of today’s clean technologies.
Let’s get to the fixes. Your first recommendation is that the California Legislature pass permit streamlining and standardization legislation for heat pumps. Is such legislation already proposed?
California has streamlined permitting for solar, batteries, and EV chargers — but not yet for heat pumps. In 2025, SPUR, the Building Decarbonization Coalition, and the Bay Area Air District co-sponsored Senate Bill 282 (Weiner), the Heat Pump Access Act, to cut permitting red tape and support clean energy goals.
SB 282 would limit what jurisdictions can do to restrict placement of heat pumps — for example, it would set statewide rules for setbacks (no more than 3 feet). It would restrict homeowner associations from limiting where heat pumps can be installed. The bill would also set up instant, checklist-based permits for heat pumps. It would limit cities to requiring just one permit per heat pump. And it would lower fees and require a flat fee that’s consistent across a jurisdiction. These reforms would reduce delays, lower costs, and make it easier for more Californians to switch to clean electric appliances.
You also recommend testing of remote inspection and self-certification programs statewide.
These measures also would reduce delays and cut costs. Remote inspections can speed up heat pump installs by cutting travel time and easing scheduling. Many cities adopted them during COVID-19, and Florida now mandates them for some permits. California should expand remote options through pilots or legislation.
Self-certification allows trained and qualified contractors to sign off on their own work, as is common in places like New York and Chicago for architects and in the UK and Sweden for appliance installers. In other parts of Europe, heating appliances don’t even require permits and inspections. SB 282 proposed a similar path in California. Agencies should pilot a program, using spot checks for compliance. These alternate pathways could improve safety while slashing permitting delays and costs.
What other state-level actions does your research point to?
We need to expand installer eligibility. To that end, the California State Licensing Board should create new codes and certifications — like Oregon’s Water Heater Installer Certificate — to allow more workers legally perform simple heat pump and water heater installs without a full plumbing license.
And we need to create a fuel-switching code. The California Building Standards Commission should form an advisory committee to develop a streamlined, statewide code for gas-to-electric appliance conversions. Modeled after CALGreen, the proposed code would simplify permitting, reduce project complexity, and accelerate electrification — just as past reforms did for solar.
What role do you see cities and counties playing in permitting reform?
Cities and counties should update local codes and permitting processes to support heat pump adoption and reflect clean energy goals. Most current rules still favor gas systems, creating unnecessary barriers. With permit compliance below 10%, municipalities must rebalance toward streamlined, user-friendly systems.
SPUR recommends that cities
- Empower sustainability staff to lead reforms and coordinate across departments.
- Pass local ordinances to simplify permitting — like allowing one multi-trade permit, removing unnecessary forms and plan checks, and exempting heat pumps from aesthetic/noise zoning rules.
- Offer flexible inspection options, including remote or self-certification.
- Eliminate or significantly reduce fees after streamlining, as Albany and other cities have done.
These actions can accelerate electrification while maintaining safety and improving compliance.