California lawmakers recently took a step towards regulating the integrity of carbon dioxide removal (CDR) strategies. If the law passes, it will impact carbon emissions reporting and compliance activities in California. Senate Bill 285 (SB 285), which is set for a hearing on April 2, 2025, aims to establish standards for CDR strategies to ensure scientific integrity in generating carbon removal credits. SB 285 addresses lawmakers’ concern that current laws lack clear definitions and durability requirements for CDRs. With clear definitions and legal requirements, SB 285 seeks to ensure that quality CDR strategies will be used to meet the state’s 2045 net-zero carbon dioxide target and align with corporate emissions reporting obligations under the California’s Climate Corporate Data Accountability Act (SB 253).
Key aspects of SB 285 include:
- Mandatory use of use of “qualified carbon dioxide removals” (i.e., qualified CDRs) for tracking progress against net-zero emission mandates and reporting offsets against corporate emission targets. SB 285 defines qualified CDRs to set integrity parameters for the CDRs that may be used for these purposes (e.g., the carbon removal process is not used for enhanced oil recovery).
- Adoption of a “like-for-like principle” that requires CDRs to match the timescale and durability of the emissions they offset. In short, this means that emissions from fossil fuels, for example, that were stored underground for millions of years must be matched with removals with similarly permanent forms of storage.
- Requirements for transparent emissions reporting and CDR use.
While SB 285 has not yet been signed into law, it demonstrates the focus the California Legislature continues to have on efforts to compel carbon reductions and reporting. We expect California to remain at the forefront of these types of ESG initiatives, particularly as federal initiatives are expected to wane under the new Trump administration.
