California's HVAC Sales-Reporting Rule Shrinks, but Contractor Purchases Are Still in Scope

California's HVAC sales-reporting rule got noticeably smaller in June. The Energy Commission's third request for information in Docket 24-OIR-03, issued June 9, 2026, dropped space-heating-only products from the draft, cut serial numbers from the required data, moved reporting to an annual cadence, and limited the whole thing to sales made to contractors. Written comments closed July 24. The state still wants a record linking a specific piece of equipment to a specific license number.

What the HVAC Sales-Reporting Rule Would Cover

Draft express terms attached to the June notice would add a new Article 6 to Title 20, Division 2, Chapter 3 of the California Code of Regulations. Section 1396.1(c) lists the covered equipment: residential central air conditioners and central AC heat pumps, non-central air conditioners and heat pumps, storage water heaters, instantaneous water heaters, and heat pump water heaters, "including but not limited to single-package, single-split, mini-split, multi-split, and hydronic equipment." On a split system, the reporting obligation attaches only to the outdoor unit.

Section 1396.4 sets out the fields. For each model sold to a reportable buyer, the seller would file equipment type, make or brand, model number, the buyer's name and business or billing address, either a CSLB-issued contractor license number or an FTB-issued Business Entity ID, the year and month of the sale, and the unit count. Reports would be submitted under penalty of perjury.

Reportable buyers are defined broadly: contractors licensed and unlicensed alike, employees of contractors, and buyers purchasing on a contractor's behalf. Commission staff said in the notice that it selected "the sale to the installing entity as the single step likely to provide the most utility," having concluded that data from further up the supply chain would add complexity without much return.

Calendar year 2027 would be the first reporting period, with the first report due March 31, 2028.

Why the State Wants the Data

This idea has a legislative ancestor that never made it. SB 795, introduced by Senator Stern in February 2023, would have directed the Energy Commission to build a statewide HVAC equipment sales registry and compliance tracking system so the Contractors State License Board and other enforcement agencies could cross-check equipment purchases against permit documentation. It stalled in Assembly Appropriations in September 2023 and is listed on the Legislature's site as an inactive bill that died.

The rulemaking is proceeding anyway, under authority the Commission already holds in Public Resources Code sections 25213, 25218(e), 25320 and 25401. A registry that died as a bill is being assembled as a regulation, and the field that makes it work as an enforcement tool, the buyer's CSLB license number, is still in the draft.

For shops that skip permits on changeouts, the state would now have an annual list of who bought what. Our guide to California contractor license and LLC bonds covers the license-side exposure.

Distributors Still Object

The American Supply Association filed on the narrowed draft on July 24, and its objection is mostly arithmetic. Section 1396.4 "would require more than 30 data points for each reportable sale," ASA said, and argued that the Commission's cost estimates understate what distributors would spend on staff, process changes and data systems built to the specification. ASA asked the CEC to allow reporting by model family and fuel type rather than specific model numbers, to push the effective date past 2027, to add a one-year grace period before penalties, and to hold another public workshop.

HARDI's position has been blunter. In its August 2025 filing on the first round of this docket, the distributor group said there should be no reporting requirement anywhere in the supply chain, and that the better fix is an improved digital permit system across California jurisdictions. Manufacturers and distributors "do not know where the final installation of the equipment will be performed," HARDI said, and the contractor is the only party in the chain that does.

HARDI has since moved. In a July 8, 2026 filing on this same third round, the group wrote that it "does not oppose useful, appropriately bounded data reporting" and credited the revised draft with "meaningful improvements over earlier concepts, including a narrower focus on residential air-conditioning and water-heating equipment, annual reporting, the removal of serial-number reporting..." What it still opposes is the state collecting customer lists, contractor identities, brand and model-level sales information and transaction-level records directly. In place of that, HARDI proposed a CEC-approved independent third-party aggregator that would validate, aggregate and anonymize the data before the Commission ever saw it, or failing that, a safe harbor for distributors reporting through its own Unitary Market Intelligence Program.

Staff are still finalizing cost estimates, and comments from individual contractors kept arriving through late August. No formal rulemaking package has been adopted. California shops already tracking the 2025 Title 24 heat pump and electric-ready mandates now have a second compliance date, and this one comes with a perjury declaration attached to somebody else's paperwork about your purchases.

Sources

• California Energy Commission. (2026). "Notice of Equipment Data Reporting Request For Information," Docket 24-OIR-03, TN 270421, June 9, 2026, with Attachment A draft express terms. efiling.energy.ca.gov
• American Supply Association. (2026). "ASA RFI Comments, Docket #24-OIR-03 - Third RFI," July 24, 2026, TN 271619. efiling.energy.ca.gov
• Heating, Air-conditioning & Refrigeration Distributors International. (2026). "HARDI, Alternative Proposal - CEC - Energy Data Collection Phase 3 - Third RFI," Docket 24-OIR-03, TN 271318, July 8, 2026. efiling.energy.ca.gov
• Heating, Air-conditioning & Refrigeration Distributors International. (2025). "RE: Docket 24-OIR-03; Energy Data Collection - Phase 3," August 18, 2025. hardinet.org
• California Legislature. (2023). "SB-795 Energy: building energy efficiency: heating, ventilation, and air-conditioning equipment sale registry and compliance tracking system." leginfo.legislature.ca.gov
• California Energy Commission. "Docket Log, 24-OIR-03 Energy Data Collection - Phase 3." efiling.energy.ca.gov