California SB 253 and SB 261: Requirements, Deadlines and 2026 Status
SB 253 requires US companies with more than $1 billion in annual revenue that do business in California to report their greenhouse gas emissions to CARB every year. The first reports, covering Scope 1 and Scope 2 only, were due by 10 November 2026, with no Scope 3 and no assurance required; reports are due every year from now on. CARB had announced no extension or new enforcement notice by 11 November 2026. SB 261 requires companies above $500 million to publish a climate-related financial risk report every two years, but it has been on hold under a Ninth Circuit injunction since 18 November 2025, and CARB is not enforcing its first deadline. Both laws apply to private companies as well as listed ones.
For most of the three years since Governor Newsom signed them on 7 October 2023, the honest answer to “when do we have to report?” was “it depends what happens next”. That has narrowed. CARB’s first regulation was approved by California’s Office of Administrative Law on 12 October 2026 and took effect the same day, which fixed the first SB 253 deadline at 10 November 2026 and the fee process that follows it.
Two things are still open. SB 261 waits on the Ninth Circuit, and the rules for 2027 onwards, including which Scope 3 categories come first and when assurance starts, exist only as a CARB staff proposal. This page keeps the settled and the proposed apart, and dates each.
1. Where things stand on 23 October 2026
| Item | Status | Settled or proposed |
|---|---|---|
| CARB Initial Regulation | Approved by the Office of Administrative Law on 12 October 2026 and effective that day, at 17 CCR §§ 96070–96077 | Settled |
| First SB 253 report | Scope 1 and Scope 2 emissions for the prior fiscal year, due by 10 November 2026; that deadline has passed | Settled |
| Scope 3 in 2026 | Not required | Settled |
| Assurance in 2026 | Not required; CARB accepts 2026 reports without it | Settled |
| Fees | CARB sends fee notices by 10 December 2026; 60 days to pay | Settled |
| SB 261 reports | First reports were due 1 January 2026. The Ninth Circuit enjoined enforcement pending appeal on 18 November 2025, heard argument on 9 January 2026 and has not ruled. CARB said on 1 December 2025 that it will not enforce the deadline while the injunction stands | On hold |
| Scope 3 from 2027 | Staff proposal: categories 1, 3, 5, 6 and 7 first | Proposed |
| Assurance from 2027 | Staff proposal: limited assurance on Scope 1 and 2 from 2027, reasonable assurance by 2030 | Proposed (the statute sets the 2030 step) |
The regulation’s route to approval was not smooth. CARB’s Board approved it on 26 February 2026 with a first deadline of 10 August. CARB later pulled the package back from the Office of Administrative Law, deferred the deadline by three months to 10 November, and resubmitted. Any source still quoting 10 August, or describing the regulation as “awaiting OAL”, predates 12 October.
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2. SB 253 and SB 261 side by side
The two laws were passed together and are administered together, which is why they are usually discussed as one. They ask for different things, from different populations, on different cycles.
| SB 253 — emissions | SB 261 — climate risk | |
|---|---|---|
| Full name | Climate Corporate Data Accountability Act (Health & Safety Code § 38532) | Climate-Related Financial Risk Act (Health & Safety Code § 38533) |
| Revenue threshold | Total annual revenue above $1 billion | Total annual revenue above $500 million |
| Who | US-formed partnerships, corporations, LLCs and other business entities doing business in California | The same, except insurers, which are excluded |
| What | Scope 1 and Scope 2 emissions, then Scope 3, measured under the GHG Protocol | A report on climate-related financial risk and the measures taken to reduce and adapt to it, using the TCFD recommendations or an equivalent such as IFRS S2 |
| Where | Filed with CARB, which makes reports public | Published on the company’s own website |
| How often | Every year | Every two years |
| First report | 10 November 2026 (Scope 1 and 2) | Due 1 January 2026; not enforced while enjoined |
| Assurance | None in 2026; limited, then reasonable by 2030 for Scope 1 and 2 | None |
| Maximum penalty | $500,000 per reporting year | $50,000 per reporting year |
A company above $1 billion is in both. A company between $500 million and $1 billion is in SB 261 only. An insurer above $1 billion is in SB 253 only.
3. Who is covered
Three tests decide it, and all three must be met.
The entity test
Both laws apply to a partnership, corporation, limited liability company or other business entity formed under the laws of California, another US state, the District of Columbia or an act of Congress. A company incorporated outside the United States is not itself a reporting entity, but its US subsidiaries can be. Being private is not an exemption: CARB’s program page says in terms that the laws apply to both public and private US companies.
The revenue test
The threshold is measured on total annual revenue, not California revenue. CARB’s regulation measures it as gross receipts, using the definition in California’s tax code, for the prior fiscal year. A company with $2 billion of revenue and $1 million of it from California is above the SB 253 line; the California share only matters for the next test.
The “doing business in California” test
CARB borrows the Franchise Tax Board’s definition in Revenue and Taxation Code § 23101, but only part of it. An entity is doing business in California if it:
- actively engages in any transaction in California for financial or pecuniary gain or profit; or
- is organised or commercially domiciled in California; or
- has California sales above the inflation-indexed threshold, which the Franchise Tax Board set at $757,070 for 2025 (it was $735,019 for 2024).
The property and payroll limbs of § 23101 are excluded, so a company with a California warehouse or California employees but no qualifying sales or transactions is not caught by those facts alone. The sales limb is the one that catches most out-of-state companies, and at about three-quarters of a million dollars it is low for a company already above $500 million in total revenue.
A subsidiary that meets the tests on its own is a reporting entity. Since the SB 219 amendments, reports can be consolidated at parent-company level, so a group can file once rather than once per entity. What it cannot do is assume a subsidiary is out because the parent files: if the subsidiary qualifies and the parent’s report does not cover it, the subsidiary still owes a report.
CARB’s preliminary list of likely covered entities, published in September 2025, ran to roughly 2,600 companies for SB 253 and 4,160 for SB 261. CARB was clear that the list was a starting point, built from public data. It does not decide coverage, and a company absent from it is not exempt.
4. SB 253: the 2026 report
What was due by 10 November 2026
Scope 1 and Scope 2 greenhouse gas emissions for the reporting entity’s prior fiscal year, measured according to the GHG Protocol. Scope 1 is direct emissions from sources the company owns or controls, such as fuel burned in its boilers and vehicles. Scope 2 is indirect emissions from the electricity, steam, heat and cooling it buys.
The 2026 report is deliberately light:
- No Scope 3. Value-chain emissions start in 2027 at the earliest.
- No assurance. CARB accepts 2026 reports without third-party assurance.
- Data you already had. CARB’s enforcement notice of 5 December 2024 lets a first report rest on information the company already held, or was already collecting, when the notice was issued. CARB said it would not penalise incomplete first reports from companies acting in good faith.
How to file
CARB has published a 2026 Reporting Guidance Document and a voluntary 2026 Report Intake Platform, both on its program page. CARB built the platform to simplify first-year reporting and fee collection; the guidance document explains what to enter. Read both before filing; they carry the operational detail that the regulation leaves to CARB.
The good-faith position
The first cycle is built for a company that has done the work imperfectly, not for one that has not done it. CARB’s 2024 notice protects good-faith effort on data quality. It does not protect a company that files nothing. In practice the risk in November 2026 is non-filing, not a rounding error in a Scope 2 figure.
If you are working the numbers yourself, the SB 253 disclosure calculator builds a Scope 1 and Scope 2 figure from fuel and electricity data, and the SB 253 methodology sets out the boundary and factor choices behind it. For the inputs themselves, see the Scope 1 combustion calculator, the Scope 2 electricity calculator and the US grid factors in EPA eGRID.
5. SB 253 from 2027: Scope 3 and assurance (proposed)
Everything in this section is from CARB’s staff pre-proposal for the 2027 framework, summarised by Mayer Brown in August 2026. It has not been adopted. It will go through the same rulemaking steps as the first regulation: a formal proposal, a public comment period, a Board vote and review by the Office of Administrative Law.
| Topic | The statute says | CARB staff propose |
|---|---|---|
| Scope 3 | Scope 3 reporting starts in 2027, on a schedule CARB sets | Start with five categories: 1 purchased goods and services, 3 fuel- and energy-related activities, 5 waste, 6 business travel and 7 employee commuting |
| Assurance, Scope 1 and 2 | Limited assurance at first; reasonable assurance from 2030 | Limited assurance from 2027; reasonable assurance by 2030 |
| Assurance standards | Left to CARB | ISAE 3000 or ISAE 3410 for engagements before 15 December 2026; ISSA 5000 after |
Two parts of the statute already limit Scope 3 exposure, whatever the final rule says. Scope 3 figures disclosed with a reasonable basis and in good faith are protected from penalty for misstatement. And between 2027 and 2030 a company can be penalised over Scope 3 only for failing to file, not for what it files.
The five proposed categories are the ones most companies can estimate from their own records: what they buy, the upstream share of the energy they already report, their waste, their travel and their staff commute. Category 1 is usually the largest and the hardest; spend-based factors are the common starting point, refined with supplier data over time. The GHG Protocol Scope 3 Standard defines all fifteen categories.
6. SB 261: the climate risk report and the injunction
What the law requires
A covered entity must prepare, every two years, a report disclosing its climate-related financial risk and the measures it has taken to reduce and adapt to that risk, and publish it on its own website. The report follows the TCFD recommendations or a successor or equivalent framework; a report prepared under IFRS S2 qualifies. A company that cannot complete every element must say what it left out and why, and describe the steps it is taking to complete it. A report made under another law, or a voluntary report, can satisfy SB 261 if it meets the same requirements. Insurers are excluded.
Why nothing is being enforced
The US Chamber of Commerce and others challenged both laws as compelled speech in Chamber of Commerce v. Randolph. The district court refused a preliminary injunction on 13 August 2025. On appeal, the Ninth Circuit on 18 November 2025 granted an injunction pending appeal against SB 261 only, leaving SB 253 in force. It heard argument on 9 January 2026 and, as of 23 October 2026, has not ruled.
On 1 December 2025 CARB issued an advisory saying it would not enforce the 1 January 2026 deadline while the injunction stands, and opened a public docket where companies could post SB 261 reports voluntarily. A separate challenge brought by Exxon Mobil in the Eastern District of California in October 2025 is on hold.
If the Ninth Circuit lifts the injunction, SB 261 becomes enforceable and CARB will need to set a new date for the reports that were due in January 2026. If it rules against the law, SB 261 stays dormant unless the State seeks further review. The prudent position is to have a draft report ready either way. The work overlaps heavily with an ISSB or CSRD climate report, and a draft has value whatever the court decides.
The SB 261 climate risk calculator works through the report’s elements, and the TCFD scenario analysis calculator covers the scenario work most reports need.
7. Fees and penalties
Annual fees
Both programs are funded by flat annual fees on covered companies. CARB will send fee notices by 10 December 2026, and companies have 60 days to pay. CARB’s preliminary estimates were about $3,106 a year for SB 253 and $1,403 for SB 261; the final amounts are set each year from the programs’ costs. A company in both pays both. Late payment carries its own charge, separate from penalties.
Penalties
| Law | Maximum administrative penalty | Limits |
|---|---|---|
| SB 253 | $500,000 per reporting year | Scope 3: penalties only for failing to file between 2027 and 2030; good-faith Scope 3 statements with a reasonable basis protected from misstatement penalties |
| SB 261 | $50,000 per reporting year | Not enforced while the injunction stands |
These are ceilings. The statute requires CARB to weigh the company’s past and present compliance and whether it took good-faith steps, and its 2024 notice signalled leniency on the quality of first reports. The practical exposure in 2026 is to a company that files nothing, not to one that files a careful estimate.
8. The 2026 report: a checklist
- Run the three tests on each US entity. Total revenue above $1 billion (and $500 million for SB 261), formed in the United States, doing business in California under the three limbs in §3. Record the result and the figures behind it; CARB’s regulation requires records to be kept.
- Decide who files. One parent report covering every qualifying subsidiary, or separate reports. Check that the parent report names the subsidiaries it covers.
- Fix the period. The prior fiscal year. Use the same boundary as any other emissions report you publish, or explain the difference.
- Calculate Scope 1 and Scope 2 under the GHG Protocol. Report Scope 2 location-based, and market-based if you buy renewable electricity or have supplier-specific factors; see location-based vs market-based.
- Document the method. Activity data, emission factors and their sources, GWP values, estimates and gaps. The 2026 report needs no assurance; the 2027 one, if the proposal holds, will, and the assurer will start from this file.
- Confirm the report went in by 10 November through the intake platform CARB set up for 2026. If it did not, file as soon as you can: CARB’s good-faith notice protects imperfect data, not a company that files nothing (see §7).
- Watch for the fee notice by 10 December and pay within 60 days.
- Start Scope 3 data collection for categories 1, 3, 5, 6 and 7, and line up an assurance provider, assuming the 2027 proposal is adopted broadly as drafted.
- Keep a draft SB 261 report ready for the day the Ninth Circuit rules.
9. Common misreadings
| Misreading | Position |
|---|---|
| “We are not listed, so it does not apply.” | Both laws cover private companies. |
| “Our California revenue is small, so we are under $1 billion.” | The threshold uses total revenue. California sales only feed the doing-business test, where the line is $757,070. |
| “SB 253 was struck down with SB 261.” | The injunction covers SB 261 only. SB 253 is in force and the first deadline was 10 November 2026. |
| “The first deadline is 30 June / 10 August 2026.” | Both dates were superseded. The regulation in force sets 10 November 2026. |
| “We need Scope 3 this year.” | Not in 2026. Scope 3 starts in 2027 at the earliest, on CARB’s schedule. |
| “We need assurance this year.” | Not in 2026. |
| “We are on CARB’s list, so we are covered” (or the reverse). | The preliminary list does not decide coverage. The statutory tests do. |
| “The SEC rescinded its rule, so US climate disclosure is off.” | The SEC rule and the California laws are separate. California’s laws are state law and do not depend on the SEC. |
10. How it fits with CSRD, ISSB and the SEC
EU CSRD. A company reporting under ESRS E1 already calculates Scope 1, 2 and 3 under the GHG Protocol, so the SB 253 numbers are largely a subset. The boundary may differ: SB 253 is filed by a US reporting entity, which may not match the EU reporting perimeter. Map the two before assuming one figure serves both.
ISSB. An IFRS S2 report is one of the frameworks SB 261 accepts, and its emissions section uses the GHG Protocol, as SB 253 does. Companies in jurisdictions adopting the ISSB standards can build one climate report that serves both California laws, with California-specific boundary notes.
SEC. The SEC’s 2024 climate disclosure rule was stayed in April 2024; the Commission stopped defending it in March 2025 and has since moved to rescind it. See SEC climate disclosure rules. California’s laws do not depend on it, and with the federal rule gone they are the main mandatory climate disclosure regime for large US companies.
GHG Protocol. SB 253 names it. The Corporate Standard covers Scope 1 and 2, the Scope 2 Guidance covers dual reporting, and the Scope 3 Standard covers the value chain.
Frequently asked questions
The first SB 253 reports, covering Scope 1 and Scope 2 emissions for the prior fiscal year, were due by 10 November 2026. CARB’s regulation setting that date was approved by the Office of Administrative Law and took effect on 12 October 2026. Reports are due every year after that.
Any partnership, corporation, LLC or other business entity formed in the United States with total annual revenue above $1 billion that does business in California. That includes private companies. Doing business means transacting in California for profit, being organised or commercially domiciled there, or having California sales above $757,070 (the 2025 threshold).
The law is on the books but cannot be enforced for now. The Ninth Circuit enjoined SB 261 pending appeal on 18 November 2025, heard argument on 9 January 2026 and had not ruled by 23 October 2026. CARB has said it will not enforce the 1 January 2026 deadline while the injunction stands. SB 253 is not covered by the injunction.
No. The 2026 report covers Scope 1 and Scope 2 only. Scope 3 starts in 2027 at the earliest. CARB staff have proposed starting with five categories: purchased goods and services, fuel- and energy-related activities, waste, business travel and employee commuting. That proposal has not been adopted.
No. CARB accepts 2026 reports without assurance. Under the staff proposal, limited assurance on Scope 1 and 2 would start in 2027, moving to reasonable assurance by 2030 as the statute requires.
Not directly. Both laws apply to entities formed under US federal or state law. A foreign parent is not a reporting entity, but its US subsidiaries are if they meet the revenue and doing-business tests themselves.
Up to $500,000 per reporting year under SB 253 and up to $50,000 under SB 261. Between 2027 and 2030, Scope 3 penalties apply only to failing to file. CARB has said first reports made in good faith will not be penalised for incompleteness; filing nothing is the real risk.
CARB’s preliminary estimates were about $3,106 a year for SB 253 and $1,403 for SB 261; final amounts are set annually. Fee notices go out by 10 December 2026, with 60 days to pay.
Yes. A parent can file one report covering its qualifying subsidiaries. A subsidiary that qualifies on its own and is not covered by a parent report must file itself.
Sources
- California Air Resources Board, California Corporate Greenhouse Gas Reporting and Climate-Related Financial Risk Disclosure Programs — program page, 2026 Reporting Guidance Document and voluntary 2026 Report Intake Platform (checked 23 October 2026).
- California Air Resources Board, SB 261 climate-related financial risk reports docket.
- SB 253 and SB 261 (2023), Health & Safety Code §§ 38532 and 38533, as amended by SB 219 (2024).
- CARB Initial Regulation, 17 CCR §§ 96070–96077, approved by the Office of Administrative Law on 12 October 2026: WilmerHale, 20 October 2026; Vinson & Elkins.
- 2027 framework pre-proposal: Mayer Brown, August 2026.
- Chamber of Commerce v. Randolph, No. 25-5327 (9th Cir.): US Chamber Litigation Center case page (checked 23 October 2026).
- CARB enforcement notice on SB 253 first reports, 5 December 2024; CARB enforcement advisory on SB 261, 1 December 2025.
- Franchise Tax Board, “doing business” thresholds under Revenue and Taxation Code § 23101 ($757,070 for 2025).
What changed in this revision
Version 2.0.1 (11 November 2026): The first SB 253 deadline of 10 November 2026 has passed, and the page now says so in the past tense. The banner shows the next date, CARB’s fee notices by 10 December 2026. We read CARB’s program page and news list on 11 November to confirm nothing had moved the date.
Version 2.0 (23 October 2026): Rewritten as a shorter, current guide. Records the Office of Administrative Law’s approval of CARB’s regulation on 12 October 2026, CARB’s 2026 guidance and intake platform, the status of the SB 261 appeal, the 2027 staff proposal (marked as proposed), and the 2025 doing-business sales threshold of $757,070 (previously $735,019 for 2024). The CARB program link was corrected.
Earlier revisions: 2 October 2026 (deadline moved to 10 November 2026; fee notice date corrected to 10 December); 15 May 2026 (first publication).