New York’s All-Electric Building Act bars fossil-fuel heating, hot water, and cooking equipment in most new construction, on a two-phase schedule that was set to begin December 31, 2025. Enforcement is currently paused. On November 12, 2025, the state agreed to a federal court stipulation suspending the law while a coalition of builders, trade groups, unions, and gas equipment suppliers challenges it on federal preemption grounds. No new permit rules took effect on January 1, 2026, and gas-fired equipment can still be installed in new buildings during the suspension.
Where the Law Stands Now
Under the stipulation, the all-electric mandate is paused until 120 days after the Second Circuit Court of Appeals rules. If either side petitions the U.S. Supreme Court, the suspension continues until 120 days after the Supreme Court either denies review or decides the case.
Three outcomes are possible. If the courts uphold the law, the compliance deadlines resume, likely on an adjusted schedule. If the law is struck down, the mandate never takes effect. If litigation drags on, the pause continues. The reinstatement window is short, so anyone planning a new project in New York should watch the Second Circuit docket. A permit pulled during the pause could leave you with a building that does not comply with a reinstated mandate, depending on timing.
Which Buildings Are Covered
The Act amends Section 11-104 of New York’s Energy Law and runs through the State Energy Conservation Construction Code. It applies only to new construction that requires a building permit after the effective dates. Existing buildings are entirely excluded. Renovations, additions, and alterations to older structures are not covered, and no one is required to remove or replace a working gas furnace, boiler, or range in a building that already exists.1New York State Senate. New York Energy Law 11-104 – State Energy Conservation Construction Code
For new construction, the rollout is split in two:
- Phase one, originally set for building permit applications filed on or after December 31, 2025: new buildings of seven stories or fewer, plus commercial or industrial buildings over 100,000 square feet of conditioned floor area regardless of height.1New York State Senate. New York Energy Law 11-104 – State Energy Conservation Construction Code
- Phase two, originally set for after December 31, 2028: all remaining new buildings, including taller residential towers and smaller commercial buildings not caught by the 100,000-square-foot threshold.2New York State Assembly. All Electric Buildings – What It Does
The three-year gap was built in to give engineers, architects, and utilities time to design high-capacity electrical systems for taller and more complex buildings. Both deadlines are paused by the court stipulation, so the actual enforcement dates depend on how the litigation ends.
What Equipment the Act Prohibits
In covered new construction, the Act prohibits installing any equipment or building system that burns fossil fuels, including natural gas, fuel oil, and propane. In practice, that means three substitutions:1New York State Senate. New York Energy Law 11-104 – State Energy Conservation Construction Code
- Heating: electric heat pumps in place of gas furnaces and boilers.
- Hot water: heat pump water heaters or electric resistance units in place of gas water heaters.
- Cooking: induction or standard electric cooktops in place of gas ranges.
The underlying goal is to keep gas piping and fuel storage out of new buildings entirely. For cold-weather performance, look for heat pumps carrying the ENERGY STAR Cold Climate designation, which requires the unit to hold at least 70 percent of rated heating capacity at 5°F and achieve a coefficient of performance of at least 1.75 at that temperature.3ENERGY STAR. Heat Pump Equipment Key Product Criteria
Exemptions
The Act carves out a substantial list of exemptions where electrification is impractical or raises safety concerns.1New York State Senate. New York Energy Law 11-104 – State Energy Conservation Construction Code
Emergency and Standby Power
Backup generators and emergency power systems can still run on fossil fuels. Hospitals, fire stations, and water treatment plants rely on diesel or natural gas generators when the grid is down, and the law leaves that alone.4New York State Assembly. Karen McMahon – All-Electric Building Act
Exempt Uses and Building Types
Certain uses can continue to install fossil-fuel equipment even in new construction:
- Commercial food establishments, including restaurants and commercial kitchens
- Manufacturing facilities
- Hospitals, medical facilities, and doctors’ offices
- Laboratories
- Agricultural buildings
- Emergency management facilities, wastewater treatment plants, and water treatment and pumping facilities
- Laundromats and car washes
- Crematoriums
- Manufactured homes as defined under state executive law
- Buildings using fuel cell systems for power generation
These exemptions apply to the specific use, not the whole building. A mixed-use development with a restaurant on the ground floor can install gas cooking equipment in the restaurant while the residential units above meet all-electric requirements.1New York State Senate. New York Energy Law 11-104 – State Energy Conservation Construction Code
Grid Reliability Waivers
If a developer applies for new or expanded electric service and the utility determines it cannot provide reliable power, the project can receive an exemption. The Public Service Commission has authority to define what counts as reasonable service here, and has proposed a specific standard: a project qualifies if the electrical upgrades needed to serve an all-electric building would take at least 18 months longer than the upgrades needed for a building with both electric and fossil-fuel systems.5New York Codes, Rules and Regulations. Implementation of an Exemption From the All-Electric Buildings Act Inconvenience is not enough; the grid has to be unable to deliver reliable power within a reasonable construction timeline.
Federal Tax Credits Available Now
Several federal incentives can offset the cost of all-electric building systems whether or not the state mandate is in effect. All three have mid-2026 cutoffs worth planning around.
Section 45L New Energy Efficient Home Credit
Builders of new energy-efficient homes can claim up to $2,500 per single-family or manufactured home meeting ENERGY STAR certification, and up to $5,000 per home meeting the higher zero-energy-ready standard. Multifamily units qualify for $500 to $1,000 per unit depending on whether prevailing wage requirements are met. The credit applies to homes acquired before July 1, 2026.6Office of the Law Revision Counsel. 26 USC 45L – New Energy Efficient Home Credit
Section 179D Commercial Building Deduction
Commercial building owners and designers can take a tax deduction for energy-efficient building systems. For 2025, the deduction runs from $1.16 per square foot for projects meeting basic energy criteria up to $5.81 per square foot for projects also meeting prevailing wage and apprenticeship requirements, with annual inflation adjustments. Construction must begin before July 1, 2026.7U.S. Department of Energy. 179D Energy Efficient Commercial Buildings Tax Deduction
Section 25C Homeowner Credit
Individual homeowners installing qualifying heat pumps can claim up to $2,000 per year under the Energy Efficient Home Improvement Credit. There is no lifetime dollar cap, so the credit can be claimed in multiple tax years for different upgrades.8Internal Revenue Service. Energy Efficient Home Improvement Credit
Planning During the Suspension
The pause is not a repeal. Litigation could resolve at any point, and once a decision comes down the 120-day reinstatement window moves quickly. Designing all-electric from the start avoids the risk of a costly mid-project redesign if the law is upheld. Building with gas remains legal during the suspension, but you should factor in the possibility that a building permitted now could be finished under a reinstated mandate, depending on how the timing shakes out.
For projects already committed to all-electric design, the federal credits above apply regardless of the state law’s status, and the mid-2026 expiration dates on Sections 45L and 179D are worth locking in even if you are not required to electrify.