Jay E. Adams refutes the idea that 1 Peter 3:21 teaches the baptismal regeneration heresy, and shows that the context actually teaches that it is Holy Spirit baptism—not water baptism—that saves:
"Through the water eight persons (souls) were saved from the flood. It was by means of water that they were saved from destruction. To this salvation by water Peter says baptism corresponds. How is that? In what way does baptism correspond to the salvation of the eight persons in the ark? First note Peter's careful qualification: "it isn't water (outward) baptism of which I am speaking": not that which removes the grime from one's skin but something inward. He was referring to an inward change that brings about a good conscience (freed from the guilt of sin) because it has approval after inquiry (that is, it is genuine). The baptism that saves is Spirit baptism, not water baptism which is but an outward symbol and expression of the inner reality. At regeneration, God baptizes His children with the Holy Spirit, thus bringing salvation to them. Baptismal regeneration confuses rather than distinguishes water baptism from Spirit baptism.
"But how does Spirit baptism save? By the resurrection of Christ (v. 21). Spirit baptism puts a person "into" Christ (1 Corinthians 12:13; Romans 6:3). When merged with Christ we become united to Him in such a way that all that He ever did in His life is attributed to us as if we had done it. We are crucified with Him, raised with Him, seated in the heavenlies with Him, etc. Peter is saying that Spirit baptism saved us by Christ's resurrection just as water in the flood saved the eight on board the ark by buoying them up above the destruction. By Spirit baptism, union with Christ, we too are raised above angels, authorities and powers in the resurrection that lifted Him to heaven. Those who persecute you are the losers, not the victors, just as the eight were in the flood. They can exert no final power over you; you are in principle, in Him, raised to the right hand of God."
Jay E. Adams, The Christian Counselor's Commentary: Hebrews, James, 1 & II Peter, Jude (Woodruff, SC: Timeless Texts, 1996), 275, 276.
1 Peter 3:21 (from Jay E. Adams' translation):
"As a counterpart to the water, baptism now saves you (not by the removal of grime from the flesh but by the approval of a good conscience before God through inquiry) by the resurrection of Christ,"
1 Peter 3:18 - 22 (surrounding context, ESV version):
"For Christ also suffered once for sins, the righteous for the unrighteous, that he might bring us to God, being put to death in the flesh but made alive in the spirit, in which he went and proclaimed to the spirits in prison, because they formerly did not obey, when God's patience waited in the days of Noah, while the ark was being prepared, in which a few, that is, eight persons, were brought safely through water. Baptism, which corresponds to this, now saves you, not as a removal of dirt from the body but as an appeal to God for a good conscience, through the resurrection of Jesus Christ, who has gone into heaven and is at the right hand of God, with angels, authorities, and powers having been subjected to him."