California climate disclosure laws: CARB delays regulations, releases Scope 1 and 2 template, and list of covered entities

On October 14, 2025, the California Air Resources Board ("CARB") revealed that it will not issue draft regulations for SB 253 (the Climate Corporate Data Accountability Act) and SB 261 (the Climate-related Financial Risk Act) on October 14th, as previously announced, and will instead issue draft regulations during the first quarter of 2026. CARB states that the delay is due to "the large volume of public comments staff have received, and given ongoing input related to identifying the range of covered entities".

CARB has been active over the last month in issuing information relating to the laws. On September 24, 2025, CARB issued a preliminary list of entities that CARB believes are subject to SB 253 and/or SB 261 (the "List of Covered Entities") and on October 10, 2025, it issued a draft reporting template and draft guidance on Scope 1 and 2 greenhouse gas emissions reporting for SB 253 (the "Template"). CARB intends for the Template to help streamline reporting, particularly for entities publishing greenhouse gas emissions data for the first time. Use of the Template by reporting companies under SB 253 is voluntary for the first reporting cycle in 2026.

Key takeaways:

• Companies are unfortunately still left with uncertainty with respect to details on what is required under the laws, particularly around (i) parent and subsidiary matters relating to both laws, (ii) what it means to "do business in California" under both laws, and (iii) Scope 3 emissions reporting under SB 253.
• CARB's notice of delayed rulemaking did not indicate any changes to the timelines for initial reporting requirements under the laws. In-scope entities must post their first SB 261 report on their respective websites by January 1, 2026. CARB has previously stated that it will use enforcement discretion for companies' initial reporting and that it is looking for "good faith efforts" to comply. It is unclear if CARB will be lenient on SB 261 reporting made after the January 1 deadline.
• CARB has stated that (i) the absence of being included in the List of Covered Entities does not mean that a company is not in scope of one or both of the laws and (ii) since the CA Secretary of State dataset used for the List of Covered Entities includes only active filings through March 2022, it may be missing companies. So, while the List of Covered Entities may be a helpful indicator of in-scope entities, it is not a comprehensive, absolute list. We recommend that companies independently assess applicability of the laws for their organization.
• Feedback on the List of Covered Entities can be submitted through an online survey. CARB states that "[e]ntities that believe they may be subject to these requirements, or may qualify for an exemption, are encouraged to complete the survey." Other comments or inquiries can be submitted to climatedisclosure@arb.ca.gov.
• The Template addresses the data that CARB is proposing to collect from covered entities across key categories, including (i) quantitative values of Scope 1 & 2 emissions, (ii) any "miniscule", "de minimis" sources excluded from the reported data based on "the materiality thresholds" as well as the quantity of emissions associated with sources excluded under the materiality thresholds¹, (iii) confirmation that all reported Scope 1 and Scope 2 emissions have been assured at the limited assurance level (and if not, an explanation), and (iv) emission reductions from direct contracts of renewable electricity and renewable gas.
• The Template also includes "optional fields" such as base year emissions and Scope 1 and 2 direct and indirect emissions for individual sources / gases; reporting of this data is optional for the first reporting cycle, but CARB could make this data required in future reporting years.
• Again, as noted above, use of the Template by reporting companies under SB 253 is voluntary for the first reporting cycle in 2026. CARB will provide guidance at a later date for future reporting cycles.
• Feedback on the Template can be submitted to CARB's public docket through October 27, 2025. CARB is specifically interested in feedback on: (i) disclosure by source versus disclosure by gas type, (ii) whether CARB should require reporting entities to use a single, conforming type of approach in defining organizational boundaries (i.e., equity share, financial control or operational control, as outlined in the Greenhouse Gas Protocol), and (iii) reporting of emissions reduction initiatives, including such associated with direct contracts for renewable electricity and renewable gas.

The notice of delayed rulemaking, List of Covered Entities, and the Template can be found here.

This article is part of a series on the California climate disclosure laws. For more information, see our previous articles: 'California Climate Disclosure Laws: CARB releases draft guidance on SB 261,' 'California Climate Disclosure Laws: CARB Refines Applicability, Deadlines, and Scope,' 'California Climate Disclosure Laws: CARB Affirms Reporting Deadlines, but Delays Regulations that Would Clarify Applicability,' and 'California Bills to Require Greenhouse Gas Emissions Reporting From Companies Doing Business in the State.'

_{1 The Template defines "materiality thresholds" as "a rule you set to decide which emission sources are so small (immaterial) that they do not need to be included in the inventory because their exclusion will not significantly affect the accuracy of the report," per the GHG Protocol Corporate Accounting and Reporting Standard.}

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_{This article is prepared for the general information of interested persons. It is not, and does not attempt to be, comprehensive in nature. Due to the general nature of its content, it should not be regarded as legal advice.}

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