CARB Extends SB 253 Deadline and Previews 2027 Reporting Rules

The California Air Resources Board’s (CARB’s or the Board’s) July 21 public workshop provided the clearest roadmap yet for greenhouse gas (GHG) reporting under Senate Bill 253 (SB 253) beginning in 2027 and provided a summary of the reporting requirements for the 2026 reporting year. At the workshop, CARB summarized recently proposed changes to the initial regulation for reporting due in 2026—open for limited public comment through August 11, 2026—and provided additional insight into proposed rulemaking for 2027 and subsequent reporting years.

As for 2026 reporting requirements, CARB formally published its 15-day notice on July 27, 2026, including the proposed extension of the Scope 1 and Scope 2 reporting deadline from August 10 to November 10, 2026. Comments are due August 11 and may address only the recent modifications noticed.

For future reporting, beginning in 2027, CARB will propose: an annual November 10 deadline; alignment with the GHG Protocol for methodologies and definitions central to disclosures; third-party assurance required from a list of accepted assurance standards; a limitation of Scope 3 emissions requirements to five main categories; and required supplementation regarding the methodologies used to quantify emissions, any measurement uncertainty, and protocols or substitutions used for any missing data. These are preliminary staff concepts, not enacted requirements, and throughout the workshop, CARB invited feedback on how it could modify its proposal to streamline the reporting process in 2027 and beyond.

CARB OPENED THE 15-DAY COMMENT PERIOD

As previously reported, CARB withdrew the Initial Regulation from the Office of Administrative Law (OAL) after submitting it on May 20, 2026, in order to make limited clarifying changes and deferred the first reporting deadline by three months. The modified text was made available to the public on July 27, 2026, for a 15-day comment period ending August 11, 2026. Comments submitted during that window must be confined to the modifications proposed, and any comment and accompanying attachment will become part of the public record. After completing this process, CARB intends to resubmit the package to OAL.

THE INITIAL REGULATION: THE 2026 REPORTING DEADLINE & REQUIREMENTS

Although the Board approved the Initial Regulation in February 2026, the regulation—including the revised deadline—must complete OAL review before it becomes effective. Reporting entities should nonetheless plan to report their Scope 1 and Scope 2 emissions by the November 10 deadline while continuing to monitor the approval process.

SB 253 generally applies to US-organized business entities with total annual revenues exceeding $1 billion and that do business in California. The Initial Regulation addresses foundational definitions, fees, exemptions, and the first-year reporting deadline. During the public workshop, CARB reiterated that the first 2026 submission will address Scope 1 and Scope 2 emissions only. Staff plans to release a voluntary online intake platform for fee contact information and emissions reporting, together with a guidance document and instructional video. CARB previously stated that strict compliance with its draft reporting template and limited assurance are not required for 2026.

CARB’s December 2024 Enforcement Notice also remains the governing policy. Under that notice, entities may report emissions in this first reporting cycle based on any data they possessed or were already collecting when such notice was issued. CARB will exercise enforcement discretion for incomplete first-year reporting where an entity demonstrates good-faith compliance efforts and retains relevant data. CARB’s responses to “Frequently Asked Questions” further instruct such entities to submit a statement on company letterhead explaining their reason for noncompliance and their good-faith efforts at disclosure. Nevertheless, entities should note that this discretion constitutes transitional relief and is not a waiver of SB 253’s reporting obligation.

CARB’S PROPOSED FRAMEWORK FOR 2027 AND BEYOND

At the July 21 public workshop, CARB announced that beginning in 2027, it will conform its requirements to the standards of the GHG Protocol. In aligning its key definitions and requirements with the well-defined and widely accepted GHG Protocol, CARB seeks to eliminate costs faced by entities due to ambiguity in reporting requirements. CARB staff announced that it aims to apply this standard to the 2027 reporting year and subsequent years. CARB explained that its proposals for reporting in 2027 and beyond remain subject to change, do not apply to the 2026 reporting year, and will be developed through separate, subsequent rulemaking, which will be subject to a full 45-day comment period.

STANDARDIZATION OF REPORTING IN LINE WITH THE GHG PROTOCOL

The proposed requirements for reporting in 2027 would: (1) require that the definitions and methodologies used align with the GHG Protocol; (2) require reporting entities to provide quantitative analysis where possible, including context surrounding the methodologies used, data collected, any missing information, and any assumptions used; (3) set November 10 as the reporting deadline for each fiscal year; (4) limit the required Scope 3 disclosures to the five most common emissions categories; (5) require limited assurance in compliance with a list of accepted assurance standards, as well as a written report by the assurance provider; and (6) allow insurance entities to submit their California Department of Insurance (CDI) disclosures so long as they satisfy all the SB 253 requirements, but require supplementation to the extent they do not do so.

CARB’s proposed concepts would require reporting entities to disclose gross Scope 1, Scope 2, and Scope 3 emissions for the preceding fiscal year in metric tons of carbon dioxide equivalent, using the GHG Protocol Corporate Standard’s Scope 2 Guidance and Scope 3 Calculation Guidance. CARB described this approach as a way of minimizing cost and burden for companies that may be subject to IFRS S2, the European Union’s Corporate Sustainability Reporting Directive, and other disclosure regimes, while adding California-specific requirements.

PROPOSED DISCLOSURES REQUIRED IN 2027

The proposed framework for 2027 would require considerably more than a top-line emissions inventory. A reporting entity also must disclose, among other things, the following:

• Its organizational consolidation approach;
• The global warming values of various emissions and assessment report vintage used;
• Emission-factor sources and relevant attributes;
• Its direct measurement and calculation model; and
• The underlying data sources, assumptions, and models supporting its calculations, and the reasoning for the methodology chosen.

Entities also would be required to assess measurement uncertainty using quantitative information where feasible and qualitative analysis where quantitative estimation is infeasible or would impose unreasonable cost or burden on reporting entities. Protocols for addressing missing data, procedures for use of substitute data, and associated assumptions also would have to be explained. Biogenic carbon dioxide would be reported separately. Any disclosure of voluntary credits, offsets, or other reduction or removal activities would be discretionary and supplemental and would be segregated from gross Scope 1, Scope 2, and Scope 3 totals. CARB also proposed an optional standard for exclusions: an entity would be free to omit emissions sources, activities, Scope 3 categories, or other information only where the omission could not reasonably be expected to influence users’ decisions, assessments, or understanding of the entity’s emissions, climate-related risks, or impacts. Any exclusions—and, where quantifiable, the estimated magnitude of the associated emissions—would have to be identified and disclosed.

PROPOSED LIMITATION OF SCOPE 3 EMISSIONS TO 5 CATEGORIES

To address readiness, cost, and the complexity of reporting all 15 GHG Protocol categories of Scope 3 emissions, CARB staff proposed requiring five commonly reported categories beginning in 2027:

• Category 1: Purchased goods and services
• Category 3: Fuel and energy-related activities not included in Scope 1 or Scope 2
• Category 5: Waste generated in operations
• Category 6: Business travel
• Category 7: Employee commuting

Other categories could be reported voluntarily where the entity has established data sources and quantification methods. For each required category, the entity would identify the category and covered activities, describe its methods and data types, state total emissions, explain exclusions, and disclose the percentage calculated using primary data. CARB did not specify when or how the remaining categories would become mandatory.

This limitation of required Scope 3 emissions categories, aimed at phasing in the regulation’s reporting requirements, may reduce the immediate compliance burden, but it does not establish that these five categories would necessarily be the most significant sources of emissions for every company. A company’s largest value-chain emissions may fall outside the proposed mandatory set. Companies should therefore map all 15 categories now, even while prioritizing the proposed five, to identify material gaps and avoid having to rebuild systems if CARB expands the mandatory categories.

PROPOSED LIMITED ASSURANCE REQUIREMENT

Beginning with reports submitted in 2027, CARB staff proposed requiring limited assurance by an independent third party concerning Scope 1 and Scope 2 emissions, including separately reported biogenic carbon dioxide. Staff identified several assurance frameworks as acceptable—including AA1000, AICPA, ISAE/ISSA, and ISO standards—rather than prescribing a single exclusive standard.

The assurance provider would be required to issue a written report identifying the assurance standard and level of certainty, the covered Scope 1 and 2 emissions, the provider’s conclusion, the name of the provider and its contact information, and the completion date.

INSURANCE ENTITIES ARE NOT ENTIRELY EXEMPT, BUT THEY MAY SUBMIT THEIR CDI DISCLOSURES

The Initial Regulation exempts insurance entities from 2026 SB 253 reporting to avoid duplicating CDI reporting. For 2027, however, staff proposed allowing an insurer to use the same report for CDI and SB 253 reporting obligations only if it satisfies CARB’s requirements. Where the CDI submission does not contain all information required by CARB, the insurer would have to supplement it.

Because CDI reporting does not necessarily include Scope 3 emissions or SB 253 assurance, the practical effect of this proposal would be to replace the current blanket exemption with a more limited mechanism to minimize duplication starting in 2027 and in future reporting years.

KEY TAKEAWAYS

Companies should take the following steps now:

1. Confirm applicability and reporting boundaries. Apply the operative revenue, “doing business,” legal-entity, parent-subsidiary, and exemption rules to determine whether your company is a covered entity. CARB’s preliminary list of covered entities is not conclusive or determinative, and each entity is required to independently determine whether it is subject to SB 253.

2. Build a defensible 2026 reporting file. If your company is a covered entity, plan to report GHG emissions for the prior fiscal year (2025) by November 10, 2026; document the data available as of December 5, 2024; retain source records; memorialize assumptions, gaps, estimates, and good-faith remediation; and align legal, sustainability, finance, tax, internal audit, and disclosure teams. Entities relying on CARB’s discretionary flexibility to accommodate the first-year reporting transition and that possess no emissions data or only limited data should prepare the required statement on company letterhead rather than simply omitting any filing.

3. Organize now to enable compliance with the required assurance level. Engage an assurance provider early to test evidentiary support, independence, timing, and the most suitable proposed standard. To facilitate the level of assurance ultimately required, establish controls over organizational boundaries, activity data, emission factors and versions, calculation tools, management review, uncertainty, missing-data substitutions, and exclusions. Choosing from CARB’s list of recognized providers is recommended.

4. Map the full value chain. Prioritize the five proposed 2027 Scope 3 categories but assess all 15 categories. Identify supplier-data rights, procurement and travel-system limitations, landlord and utility dependencies, commuting-survey needs, and contractual provisions necessary to obtain auditable information.

5. Engage with the rulemaking. Review the modifications that CARB proposed on July 27 and submit any pertinent comment by August 11, recognizing that comments will be public. Monitor CARB’s upcoming intake platform, participate in relevant listening sessions, and reassess the compliance plan when CARB issues the formal rulemaking text.

CONCLUSION

CARB’s SB 253 implementation path is now clearer. CARB’s proposed modifications to its initial implementing regulation were submitted to the public on July 27, 2026, with comments due August 11. Only after the public comment period ends and a review of the comments received is complete will CARB submit the regulation to the OAL for its review.

Separately, CARB’s July 21 workshop provided insight into how CARB intends to implement the GHG disclosure laws going forward. During the workshop, CARB communicated a more streamlined and decisive approach for the 2027 reporting year and beyond. CARB aims to eliminate the uncertainty that accompanied the first year of the regulation. This includes: a concrete annual reporting deadline of November 10; more specificity in the accepted methodologies for emissions data collection and direct instructions on the required accompanying qualitative and quantitative information; a clear, proposal to require only five categories of Scope 3 emissions; a requirement that reporting entities receive and report third-party assurance for Scope 1 and Scope 2 emissions data; and a proposal to make insurance entities subject to the reporting requirements while allowing them to submit conforming disclosures already compiled for required CDI reporting.

For those seeking additional information, CARB announced sector-specific listening sessions from August 5 through September 9, 2026, where reporting entities in each industry can share their implementation experiences and best practices with one another.