California’s New Law: 5,400 Companies Must Report Carbon Emissions, increase cost

California's New Law: 5,400 Companies Must Report Carbon Emissions, increase cost

California’s New Law

A new California law enacted on Monday would require large firms like Apple and Disney to publish their carbon footprints.

A law requiring the reporting of greenhouse gas emissions by businesses with more over $1 billion (£817 million) in annual revenue was signed by Governor Gavin Newsom.

The federal level is making slow progress with similar initiatives.

Mr. Newsom welcomed the law’s objectives but expressed doubts about its implementation.

“This important policy, once again, demonstrates California’s continued leadership with bold responses to the climate crisis,” Mr. Newsom wrote in a statement upon signing the bill. “However, the implementation deadlines in this bill are likely infeasible.”

“Concerned about the overall financial impact of this bill on businesses,” he continued.

A system for reporting emissions must be in place by January 1, 2025, or a little over a year from now, according to legislation, for the California Air Resources Board.

Large firms are under increasing pressure to disclose how much they release gases that trap heat in the atmosphere, both directly via their activities and indirectly through things like buying power, as the need to combat climate change becomes more urgent.

Many multibillion dollar businesses are based in California, which has a history of passing innovative environmental policies.

With headquarters in the state, companies including Chevron, Meta, Wells Fargo, Intel, and HP generate more than $50 billion (£40 billion) annually.

Additionally, the state recently approved a law mandating businesses with annual revenues of more than $500 million (£408 million) to disclose any financial risks associated to climate change. According to Mr. Newsom, this law will motivate businesses to take steps to mitigate these risks. But once more, he voiced reservations in a signing statement over the expenses for businesses.

For more than a year, the Securities and Exchange Commission (SEC), the US stock and market regulator, has been working on federal regulations requiring corporations to report emissions and climate-related risks.

Senator Elizabeth Warren and others who support the commission’s proposed rule claim that it would prevent “greenwashing,” which occurs when a firm exaggerates its environmental efforts in its marketing, and that it would aid investors in understanding the vulnerabilities of various companies.

However, the rule might be expensive for businesses and challenging to follow, according to the Chamber of Commerce, the largest business organization in the nation.

The organization has also questioned whether emissions and risk reports should be taken into account when making investment decisions and whether a markets regulator should be in charge of enforcing environmental regulations.

When the commission will accept the rule’s final draft is unclear.

what is Carbon Emissions

Carbon emissions are the atmospheric emissions of greenhouse gases like carbon dioxide (CO2). The Earth’s temperature rises as a result of greenhouse gases’ ability to capture solar heat. Climate change is what this is.

Human activities, such as burning fossil fuels (coal, oil, and natural gas) for transportation, electricity, and heating, are the main causes of carbon emissions. Agriculture, industrial operations, and deforestation are additional sources of carbon emissions.

Climate change is largely attributed to carbon emissions. The amount of greenhouse gases in the atmosphere rises together with the temperature of the planet. This can result in a number of issues, such as more frequent extreme weather conditions, rising sea levels, and modifications to plant and animal life.

Switching to renewable energy sources, increasing energy efficiency, and minimizing deforestation are just a few actions that may be taken to cut down on carbon emissions. In order to mitigate the consequences of climate change and save the environment, carbon emissions must be reduced.

Examples of carbon emissions include:

  • The smoke that comes out of a power plant chimney
  • The exhaust fumes from a car
  • The methane gas released from a landfill
  • The carbon dioxide released when trees are cut down and burned

Although carbon emissions are a significant issue, there are things we can all do to lessen our influence. We can reduce our driving, energy consumption at home, and meat consumption, for instance. We can assist companies and groups that are attempting to lessen their carbon footprint.

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