What's Happening?
The California Air Resources Board (CARB) has announced a delay in the initial rulemaking for Senate Bills 253 and 261, which are part of the state's climate disclosure laws. Originally scheduled for completion,
the rulemaking process will now extend into the first quarter of 2026. This delay is attributed to the large volume of public comments and ongoing input regarding the identification of covered entities. The preliminary list of entities includes major electric utilities, energy companies, and manufacturers such as Pacific Gas and Electric, Southern California Edison, and Sierra Pacific Industries. These entities are required to report their greenhouse gas emissions and climate-related risks under the new laws, which target companies with annual revenues exceeding $500 million and $1 billion respectively.
Why It's Important?
The delay in implementing California's climate disclosure laws is significant as it impacts a wide range of industries, including energy and manufacturing. These laws are designed to increase transparency and accountability in corporate environmental practices, potentially influencing business operations and investment decisions. Companies on the preliminary list may face increased scrutiny and pressure to comply with environmental standards, affecting their operational costs and public image. The delay also reflects the challenges in balancing regulatory requirements with industry feedback, highlighting the complexities of implementing comprehensive climate policies.
What's Next?
Entities covered by SB 253 and SB 261 are expected to submit their reports on climate-related risks and emissions by 2026. CARB will continue to refine the reporting template and seek public input to improve the process. Companies will need to prepare for compliance, potentially adjusting their operations to meet the new standards. The delay provides additional time for stakeholders to adapt and for CARB to address concerns raised during the public comment period.
