AB 766

Bill Subjects

Abstract

The California Global Warming Solutions Act of 2006 requires the State Air Resources Board to adopt regulations to require the reporting and verification of statewide greenhouse gas emissions and to monitor and enforce compliance with the act. The act requires the state board to make available, and update at least annually, on its internet website the emissions of greenhouse gases, criteria pollutants, and toxic air contaminants for each facility that reports to the state board, as provided. This bill would require, beginning January 1, 2025, and annually thereafter, a covered corporation to disclose to the state board and the Secretary of State specified information for the prior calendar year, including, but not limited to, the potential financial impacts of, and any risk management strategies relating to the physical and transition risks, as defined, posed to the covered corporation by climate change. The bill would require the state board to establish climate change-related disclosure guidance that, to the extent practicable would be specialized for industries within specified sectors of the economy, establish reporting standards for estimating and disclosing direct and indirect greenhouse gas emissions, as defined, include reporting standards for fossil fuel-related assets, establish a minimum social cost of carbon, as defined, and require a covered corporation to conduct climate scenario analyses, as provided. The bill would require a covered corporation that engages in the commercial development of fossil fuels, as defined, to include specified information in its disclosure, including, but not limited to, an estimate of the total and disaggregated amount of direct and indirect greenhouse gas emissions that are attributable to combustion, flared hydrocarbons, and other specified activity. The bill would require, on or before January 1, 2024, the state board, in consultation with the Secretary of State and the Treasurer, to develop and adopt regulations for these purposes. The bill would define a "covered corporation" for these purposes as a publicly traded domestic or foreign corporation whose principal executive offices, according to the corporation's SEC 10-K form, are located in the state and whose annual revenues exceed $100,000,000. Existing law designates the Department of Finance as the state agency with general powers of supervision over all matters concerning the financial and business policies of the state. Existing law establishes the California Debt and Investment Advisory Commission to, among other things, maintain contact with state and municipal bond issuers, underwriters, investors, and credit rating agencies to improve the market for state and local government debt issues and to assist state and local governments to prepare, market, and sell their debt issues. This bill would require, on or before January 1, 2024, the Department of Finance, with guidance from the Treasurer and the California Debt and Investment Advisory Commission, to develop climate change disclosure guidance, comparable to the regulations required to be adopted by the state board, for issuers of state and local debt.