California Emissions Reporting Bill Will Get Governor’s Approval

California Gov. Gavin Newsom (D) said he will sign measures requiring thousands of companies to report greenhouse gas emissions and disclose climate-related financial risks.

The legislation would be the first such laws in the country and apply to both public and private companies, going further than similar rules the US Securities and Exchange Commission is considering.

Newsom said during an event on climate change in New York on Sunday that the state prides itself on pioneering environmental laws, citing California’s cap-and-trade program and pointing to efforts to curb vehicle emissions during Ronald Reagan’s time as governor.

“Of course I am going to sign those bills and California will continue to maintain that leadership,” Newsom said at Climate Week NYC.

Newsom added a caveat that there will be “cleanup” on the legislation, signaling lawmakers will revisit the issue next year. His office did not elaborate when asked for comment.

Business groups have opposed the legislation, arguing implementation will be costly and that state officials should at least wait to see what steps the SEC will take on the issue.

Several high-profile California companies have supported the emissions reporting requirements, however, including Apple Inc., Salesforce Inc., and Google.

The emissions reporting legislation (S.B. 253) would apply to any company with more than $1 billion in revenue doing business in the state. Ceres, an environmental group backing the measure, estimates more than 5,300 companies would be covered by the new rules.

Under the measure, companies would have to report their emissions from operations and outputs from energy use beginning in 2026. The bill would require reporting of indirect emissions—from sources not directly controlled by the company, such as those from the supply chain—starting in 2027.

A separate bill (S.B. 261) would require companies with more than $500 million in revenue doing business in California to report every two years on climate-related financial risks starting on or before Jan. 1, 2026.

The California Air Resources Board would be responsible for finalizing the details of both bills.