In December 2024, the California Air Resources Board (CARB) published a notice of enforcement discretion for the Climate Corporate Data Accountability Act (SB 253). SB 253 requires companies doing business in California with total revenues over $1 billion to annually report their Scope 1, 2, and 3 carbon emissions. Scope 1 emissions are direct emissions from a company’s owned or controlled sources, while Scope 2 emissions are indirect emissions from generating a company’s purchased energy. Scope 3 emissions are all indirect emissions that occur throughout a company’s value chain.SB 253 is of two significant climate disclosure laws signed by Governor Newsom in October 2023.

SB 253 directs CARB to promulgate regulations to implement the law. These regulations will include a date in 2026 to be determined by CARB for when the initial scope 1 and 2 emissions reports are due. The notice informs covered entities that CARB will not take enforcement action for incomplete reports for the first reporting cycle, “as long as the companies make a good faith effort to retain all data relevant to emissions reporting for the entity’s prior fiscal year.” CARB emphasized that this notice applies only for the transition period and urges regulated entities to move towards full compliance as quickly as possible. CARB will publish additional reporting guidance during its rulemaking process for subsequent reporting cycles. Regulations are due by July 2025.