Over the last couple of weeks we’ve seen two key decisions in the world of building electrification. On July 18, Rinnai v. South Coast Air Quality Management District upheld a local regulation eliminating nitrogen oxide (NOx) pollution from certain appliances in Southern California’s South Coast Air Basin. On July 23, Mulhern Gas v. Mosley rejected an argument challenging New York’s all-electric requirement for many new buildings. Both these cases limit the impact of California Restaurant Association v. City of Berkeley, which held that the federal Energy Policy and Conservation Act (EPCA) preempts state and local regulation of some all-electric requirements.
Background on EPCA Preemption and Berkeley
There’s a lot to unpack here, so let’s start with the basics: EPCA is a federal law that, among other things, sets energy-efficiency standards for various appliances including most types of heating and air-conditioning equipment. EPCA also prevents state and local regulations “concerning the energy efficiency, energy use, or water use” of appliances covered by EPCA from affecting those appliances. There are numerous exceptions to EPCA preemption, including a pair of provisions that protect regulations in “building codes for new construction” which we call the “EPCA Safe Harbor” or “Code Exemptions.”
In Berkeley, a three-judge panel of the Ninth Circuit interpreted the phrase “concerning…energy use” to preempt a local ordinance that prohibited the installation of gas pipes in new buildings. The opinion’s logic, roughly, was that the ordinance effectively blocked gas appliances from being used in certain buildings and therefore reduced the appliances’ “energy use” in those buildings to zero. The City of Berkeley asked for a “rehearing en banc”—essentially a redo of the appeal with a larger group of judges, a rare procedure which is only performed when a majority of the active judges agree that the case is important enough to revisit.
The Ninth Circuit declined to rehear the case, but the process yielded two important developments. First, the panel amended its opinion to emphasize its limitations: in particular, the amended opinion stressed that the ordinance was a “building code” and that the existence of the Code Exemptions indicates that EPCA is meant to apply to building codes. Second, a group of eight active judges, supported by an additional three senior judges, filed a dissent stating that they thought the case should have been reheard en banc. Specifically, the dissenting judges argued that “energy use” does not refer to an appliance being used in a particular place, but rather the predicted amount of energy that the appliance will use in normal operation—just a different way of measuring energy efficiency.
Rinnai: Electrification on Berkeley’s Turf
This brings us to our first case, Rinnai v. South Coast Air Quality Management District. In Rinnai, the plaintiffs challenged the South Coast’s Rule 1146.2, which sets limits on how much NOx pollution certain heating equipment can release. (This is different from Rules 1111 and 1121, which limit NOx pollution from other types of equipment and were recently in the news.) The latest amendments to Rule 1146.2 reduced the NOx cap to zero, effectively preventing the use of fossil fuels for those appliances, at least under the technology that is currently widely available. Because it would effectively prevent the use of various EPCA-covered appliances, the plaintiffs argued that this was no different from the ordinance in Berkeley and should be preempted for the same reasons.
Judge Percy Anderson of the Central District of California disagreed. In his opinion, Judge Anderson noted that the Ninth Circuit “expressly limited its holding” to “building codes that regulate the gas usage of covered appliances.” Because Rule 1146.2 “is not a building code, and it does not prohibit or regulate the quantity of natural gas used by appliances,” Judge Anderson found that Berkeley does not apply to it. Given that Berkeley does not govern this type of regulation, Judge Anderson determined that Rule 1146.2 is not preempted by EPCA because it “addresses the pollution appliances emit and not their energy use” and “says nothing about the quantity of gas an appliance may use.”
Rinnai stands for two very important principles. The first is that Berkeley’s impact is limited to “building codes” that explicitly “prohibit or regulate the quantity of natural gas used by appliances.” Specifically, Judge Anderson’s opinion notes that Berkeley “does not reach the state regulation of toxic emissions…in order to comply with federal air pollution standards.” The second is that, in the absence of Berkeley’s reasoning, EPCA does not preempt “air pollution regulations,” even if those regulations prevent the use of an appliance.
Rinnai therefore points out one way for governments in the Ninth Circuit—including the West Coast and several Mountain States—to continue protecting their constituents from the harms of fossil-fuel combustion. If other courts follow Rinnai, strict regulations on air pollutants will survive EPCA preemption, even if they ultimately prevent EPCA-covered appliances from operating. This appears to be especially true for regulations of the so-called “criteria pollutants” that the Clean Air Act requires states to keep in check, although there is at least an argument for the regulation of any air pollutant this way. That said, other courts don’t have to follow Rinnai on this question, and the plaintiffs have the option to appeal the case to the Ninth Circuit.
Mulhern Gas: Rejecting Berkeley—Again
Then there’s Mulhern Gas Co. v. Mosley, which dropped on July 23. This case is a little more straightforward because it closely mirrors the City of New York case, which received a district-court ruling in March. Mulhern Gas challenges the All-Electric Buildings Act, a New York law requiring an amendment to the state building code prohibiting fossil-fuel equipment in most new buildings (which has since been adopted into the code). The plaintiffs made the same argument as in Rinnai, City of New York, and Berkeley: that EPCA preempts the Act because it would prevent some EPCA-covered appliances from being used in some buildings, and therefore “concern[s]” those appliances’ “energy use.”
Judge Glenn Suddaby, of the Northern District of New York, found that the All-Electric Buildings Act is not preempted. In doing so, Judge Suddaby adopted the interpretation in the Berkeley dissent and the City of New York opinion: that the term “energy use” in EPCA’s preemption provisions refers to the amount of energy a product is expected to use when it is manufactured, not the amount that it would be able to use if it were installed in a building. Given that interpretation of “energy use,” the All-Electric Buildings Act “neither directly regulate[s] energy use…, nor do they in any way concern the energy use of [an EPCA-]covered product.” In other words, a regulation that “prohibit[s] the installation of any fossil-fuel equipment…, regardless of the energy use of such equipment,” is not preempted by EPCA.
The Mulhern Gas case is in a bit of an awkward position, since the defendant—New York’s Secretary of State—has not yet asked for the case to be dismissed on the ground that the All-Electric Buildings Act is not preempted. (The Secretary of State requested dismissal on a technical basis instead.) Judge Suddaby has, however, declared that he will dismiss the case on his own unless the plaintiffs provide a reason not to by August 13. The plaintiffs may find some way to keep the case alive, but it appears unlikely. Even the plaintiffs’ lawyers appear to expect that they will need to appeal the case soon: they just suggested to the Second Circuit, which would have jurisdiction over the appeal, that an appeal would be coming “in short order” and should be combined with the City of New York appeal.
What it all could mean
These cases are, first and foremost, big wins for people living in Southern California (disclosure: I’m one of them) and in New York. The metropolitan area where the South Coast Air Basin is located has the worst air pollution in the country measured in terms of ozone, the chemical that NOx creates in the air. Meanwhile, New York’s new all-electric building code will reduce energy bills and improve health outcomes for people living in them for decades to come—and at a much lower cost than trying to do so after the building is already constructed. These electrification requirements are especially important for people who rent their homes, since they rarely have the opportunity to choose healthier or more efficient appliances for themselves.
These cases also carry important implications for building regulations generally. The two opinions represent two different approaches to handling the Berkeley decision: Rinnai limits its scope, applying Berkeley only to building codes, while Mulhern Gas (along with City of New York) rejects it entirely. State and local governments in the Ninth Circuit may be able to follow the South Coast approach and use zero-emissions standards to limit building pollution; outside of the Ninth Circuit, Mulhern Gas may indicate the beginning of a consensus that Berkeley is simply wrong and should not be followed.
As noted above, both Rinnai and Mulhern Gas are subject to appeal, and the appeal in the related City of New York case is already underway. There are a wide variety of possibilities for these appeals. The Second Circuit could wipe out the all-electric regulations in New York City and New York State, agree with the district courts and directly contradict the Ninth Circuit, or find some other way to uphold the decisions. If Rinnai is appealed, the Ninth Circuit could take the opportunity to either limit or broaden the impact of Berkeley. But even with this uncertainty, these cases have gone about as well as they could for proponents of building electrification.
Daniel Carpenter-Gold, Senior Staff Attorney
August 1, 2025