The California Air Resources Board (CARB) will publish proposed regulations for the state’s landmark climate-risk disclosure laws — Senate Bills 253 and 261 — on 14 October, the agency announced during its second public workshop on the legislation.
The rules, which will undergo a 45-day consultation period, are expected to go before CARB’s board for consideration on 11–12 December. The agency had originally been required to finalise the regulations by 1 July.
SB 253, also known as the Climate Corporate Data Accountability Act, requires companies with revenues above $1 billion to report their Scope 1 and Scope 2 greenhouse gas emissions, with Scope 3 disclosures to follow at a later stage. SB 261, the Climate-Related Financial Risk Act, obliges companies generating at least $500 million in annual revenue to file biennial climate-related risk reports.
According to CARB estimates, 2,596 companies will be covered by SB 253 and 4,160 by SB 261. Reporting under SB 253 will begin with Scope 1 and 2 emissions disclosures, due by 30 June 2026.
CARB also outlined projected compliance costs. Entities covered by SB 253 will face an annual fee of $3,106, while those under SB 261 will pay $1,403. Firms with more than $1 billion in revenue will be subject to both charges. The agency itself expects implementation to require a one-off cost of $20.7 million, funded temporarily through the Inflation Reduction Act’s Greenhouse Gas Reduction Fund, alongside ongoing annual costs of $13.9 million.
Non-profits, government entities, companies employing only remote workers in the state, and certain wholesale electricity operators are expected to be excluded from the scope.
While CARB has delayed the release of the rules, officials stressed that the 2026 disclosure deadlines remain in place. “Those reporting dates are not going to be pushed back; that is abundantly clear,” Julie Santoro, Sustainability Reporting Leader at KPMG’s Department of Professional Practice, said following CARB’s first workshop in May. “So don’t pray that they will be. Start preparing.”
The laws, signed by Governor Gavin Newsom in 2023 and reaffirmed in 2024, have survived multiple legal challenges. A federal judge recently declined to block them, with Crowell & Moring Partner Juge Gregg noting that “companies won’t get a reprieve from fast-approaching reporting deadlines”.
CARB is accepting feedback on its proposals until 11 September and released FAQ guidance in July to assist firms in preparing for compliance.
