CARB adopts implementing rules for SB 253 and SB 261

Link to Resolutions

Key Takeaways from the Adoption

The first SB 253 reporting deadline remains August 10, 2026, for scope 1 and scope 2 GHG emissions covering FY 2025 data. Entities that may be covered should begin applicability assessments and readiness planning now.

CARB reiterated that compliance expectations prioritize good faith efforts and measurable progress in greenhouse gas reporting rather than perfection. Organizations facing compliance challenges are encouraged to engage CARB staff early to discuss roadblocks.

Public comments centered on three primary issues: exemption of insurance sector under SB 253, the reporting timeline, and ongoing litigation concerning SB 261 (which remains subject to an injunction and is not currently being enforced).

Exemption for insurance companies

One of the most notable outcomes of the meeting was CARB’s decision to exempt insurance companies from SB 253. Under previous versions of the rulemaking, insurers were exempt only from SB 261. During the public comment period, multiple stakeholders urged CARB to remove the broader exclusion and require insurers to report emissions under SB 253. CARB ultimately maintained the expanded exemption, citing the need to avoid duplicative reporting. The agency explained that the California Department of Insurance (CDI) already administers a TCFD-aligned climate risk disclosure survey that staff described as required for participating insurers. CARB staff noted that the survey includes emissions-related prompts and applies to insurers with $100 million or more in underwriting premiums, a lower threshold than SB 253 or SB 261. According to CARB, the CDI program captures approximately 1,700 respondents representing more than 85 percent of the U.S. insurance market, and CDI publishes aggregated results publicly, including through a Power BI dashboard.

CARB further stated that it is coordinating with CDI and plans to continue that collaboration as future requirements such as Scope 3 reporting are developed. The goal, according to staff, is to address regulatory gaps without creating overlapping reporting or inconsistent reporting obligations.

SB 253 timing for first year reporting

Many stakeholders commented that the August 10, 2026 reporting deadline is too short, particularly given the anticipated demand for third-party assurance services. Stakeholders raised concerns of a potential verification bottleneck and urged CARB for an extended Dec 31 deadline.

CARB clarified how reporting years are determined based on fiscal year-end timing. February 1st, 2026 is the cutoff date that determines which years' data an entity should report on August 10th, 2026. Companies with fiscal years ending between January 1 and February 1, 2026 will report emissions for the fiscal year ending in 2026. Companies with fiscal years ending between February 2 and December 31, 2026 will report emissions for the fiscal year ending in 2025. In all cases, covered entities will have at least six months following the close of their fiscal year to submit GHG emissions reports.

In response to concerns about timing, CARB explained that the first year approach is tied to each company’s fiscal year end, recognizing that fiscal calendars vary. CARB stated it is trying to balance providing companies enough time to prepare with the goal of making emissions information public in a timely way. Staff emphasized that the shortest reporting window applies only to some entities, while most will have a longer lead time. CARB indicated that it considers the timeline workable for year one because it has provided enforcement discretion and flexibility for initial reporting cycle. Entities will be permitted to submit emissions data they have already collected or were planning to collect. CARB described the rollout as iterative, intended to support a ramp up period as companies build internal systems for ongoing data collection and reporting. For additional information on disclosure timing, see this article.

Active litigation and enforcement pause for SB 261

CARB acknowledged ongoing litigation (Chamber of Commerce v. Sanchez) and stated that the Ninth Circuit issued an order on November 18, 2025 enjoining enforcement of SB 261 while the appeal is pending, so CARB is not enforcing SB 261 for as long as the injunction remains in effect. Staff emphasized the distinction between enforcement and rulemaking: CARB can continue developing the regulation even while it is not enforcing SB 261. CARB also noted the injunction does not apply to SB 253.

How Ramboll can help

This development underscores a broader global trend toward standardized climate disclosure. Whether viewed as a challenge or an opportunity, the rules signal that transparency is becoming integral to corporate performance assessment.

If your organization is reviewing whether these rules apply or determining how prepared you are, support is available in the following areas:

• Scope 1, 2, and 3 GHG emissions – Audit-ready GHG inventories and documentation built for assurance, compliance, and stakeholder confidence.
• GHG readiness assessments – Evaluation of GHG emissions data to meet disclosure and verification requirements.
• GHG Verification support – Third-party GHG verification and documentation aligned to industry standards.
• Climate risk and opportunity services – Assessment of physical and transition risks alongside strategic opportunities to inform resilient, forward-looking business decisions.
• Ongoing advisory services – Continuous support for navigating evolving disclosure obligations across geographies.