Carbon accounting regulations in the Americas

Monitoring, reporting, and reducing greenhouse gas (GHG) emissions is becoming increasingly crucial for companies to address risks of climate change as part of their long-term business strategies. In addition, regulations mandating carbon accounting and reporting from federal and state law are growing from the facility to the corporate level and demanding better risk management and transparency.  

In the second of three regional articles, Enhesa experts Paula Galbiatti Silveira and Marina Dorileo outline the carbon accounting and reporting requirements emerging in various American countries a, including cross the US — following global trends outlined further in our eBook, Getting ahead of carbon accounting.

Carbon accounting and reporting in the US

In the United States, GHG emissions reporting is mandatory for large GHG emitters. The country currently has two mandatory climate-related frameworks to monitor and mitigate carbon emissions.
 

Greenhouse Gas Reporting Protocol 

The Greenhouse Gas Reporting Protocol (GHGRP), mandated by the US Environmental Protection Agency (EPA), requires GHG emissions reporting.  

More specifically, the Mandatory Greenhouse Gas Reporting (40 CFR Part 98) rule requires companies that are suppliers of fossil fuels or industrial GHG, manufacturers of vehicles and engines, and facilities that emit 25,000 metric tons or more per year of GHG emissions to submit annual reports. 

The mentioned companies in scope are required to have a monitoring plan which must include the following details: 

• The identification of positions of responsibility for the collection of emissions data 

• An explanation of the processes and methods used for GHG calculations 

• A description of the procedures and methods adopted for quality assurance, maintenance, and repair of monitoring systems, flow meters, and other instrumentation 

Further, applicable companies must report their GHG emissions to the EPA annually on 31 March — the data of which is made public every October.
 

Securities and Exchange Commission Regulation 

In 2024, the US Securities and Exchange Commission (SEC) increased its regulatory focus on climate-related risks and opportunities by adopting rules to enhance and standardize climate-related disclosures by public companies and in public offerings.  

The rules amend the Securities Act of 1933 and the Security Exchange Act of 1934. The changes didn’t include Scope 3 emissions disclosure, but required companies to include climate-related risk information when they submit their registration statements and annual reports. 

Further mandatory disclosures when calculating GHG emissions include: 

• Scope 1 and Scope 2 GHG emissions 

• Methodology 

• Significant inputs 

• Significant assumptions 

However, shortly after the adoption of the climate rules, the SEC issued a voluntary stay of the rules, which never went into force, pending legal challenges in US Courts. Recently, the US SEC withdrew its defense of the climate rules, but the Court case is still pending decision.

Carbon accounting and reporting at the state level

State level legislation complements federal rules on GHG monitoring and reporting. In addition, US states have passed legislation on corporate climate reporting to increase attention and efforts for climate change mitigation, pending review of the US federal rule.
 

California 

California currently exercises two emissions reporting regulations to control GHG emissions in the state.
 

Air Resources (17 CRR Div 3) 

Under this regulation, specific types of companies must have a GHG monitoring plan in place, in addition to tracking and reporting their GHG emissions to the California Air Resources Board (CARB) annually by 10 April. The California requirements differ from the federal requirements as they apply to a smaller group of entities. 

The applicable companies include, among others: 

• Any that own or operate a facility that contains a listed source category, such as cement production, petroleum refineries, and CO2 injection 

• Operators of facilities with listed source categories (such as iron and steel production) when stationary combustion and process emissions of CO2, CH4, and N2O equal or exceed 10,000 metric tons CO2e for a calendar year 

• Listed suppliers of fuels provided for consumption within California
   

Climate Corporate Data Accountability Act 

This Act requires the California Air Resources Board (CARB) to devise and adopt, by 1 July 2025, regulations requiring companies that operate in California with a total annual revenue exceeding USD 1 billion to report GHG emissions. 

• Scope 1 and Scope 2 GHG emissions in 2026 

• Scope 3 GHG emissions on a schedule specified by the state board 

CARB will allow reporting entities to use currently available data on Scope 1 and 2 emissions in 2026, following an enforcement notice granting an additional year to prepare with the obligations.
 

Colorado 

Regulation 22 — Colorado Greenhouse Gas Reporting and Emission Reduction Requirements (5 CCR 1001-26) establishes mandatory GHG monitoring, auditing, recordkeeping, and reporting requirements for owners and operators of certain facilities that directly emit GHGs in Colorado.  

It applies to activities such as electric service providers, active industrial waste landfills, and industrial wastewater treatment facilities. In addition, the regulation sets the methodology for carbon accounting according to the activity and requires companies to use the EPA updates to the Part 98’s global warming potential (GWP) values for GHGs adopting the Intergovernmental Panel on Climate Change’s (IPCC) Fifth and Sixth Assessment Reports (AR5/AR6) when calculating GHG emissions.
 

HB25-1119 Require Disclosures of Climate Emissions 

In addition to GHG monitoring, accounting and reporting mentioned above, this proposed bill was introduced to the Colorado General Assembly on 28 January 2025 to require businesses that operate in Colorado and have a total revenue exceeding USD 1 billion to disclose their total GHG emissions during the preceding calendar year.  

If the bill is passed, mandatory reporting requirements would need to be: 

• Disclosed on or before 1 January 2028 for Scope 1 and Scope 2 GHG emissions 

• Phased in over 2029 – 2031 for Scope 3 GHG emissions
   

Brazil 

Brazil currently has multiple laws at the federal and state levels on GHG emissions accounting and reporting and a new law establishing an emissions trading system.
 

CVM Resolution 193 

Listed companies will have to prepare and submit a sustainability-related financial information report to the Securities and Exchange Commission of Brazil (CVM) as of 1 January 2026.  

Related to climate, this report will have to be prepared in accordance with the CBPS Technical Procurement 02 — Climate-Related Disclosures, based on the International Sustainability Standards Board (ISSB) climate standard IFRS S2. 

Companies can opt to voluntarily disclose climate-related information in 2025. The methodology for carbon accounting is the one established by IFRS S2.
 

Law 15.042/2024 

Since 12 December 2024, this Law established the Brazilian System of GHG Emissions Trade (SBCE) to limit GHG emissions in the country. It also allows for the trading of assets representing the emission, emission reduction, or removal of GHGs. 

The SBCE applies to activities, sources, and facilities in Brazil that emit, or have the potential to emit, GHGs (excluding indirect emissions from agricultural and livestock inputs and raw materials). 

• The SBCE will be implemented over a six-year period 

• Companies emitting over 10,000 tCO2e annually must submit a monitoring plan to be approved 

• Following approval, companies must submit annual GHG emissions and removal reports 

São Paulo  

São Paulo regulates state level carbon accounting and reporting, in the absence of a federal law.
 

CETESB Board Decision 83/2024/A of 3 October 2024 

In the absence of a federal law that comprehensively regulates carbon accounting and reporting in Brazil, state legislation has regulated the matter for companies operating in their territory. 

In the State of São Paulo, companies carrying out activities listed in Article 3 of CETSB Board Decision 83/2024/A (such as facilities emitting more than 20,000 tons a year of CO2eq) must report their Scope 1 and 2 emissions annually to the Environmental Company of the State of São Paulo for the preceding year between 1 September and 31 October, using the Brazilian Technical Standards Association (ABNT) methodology, the GHG Protocol, or another similar standard. 

Currently, Scope 3 accounting and reporting is voluntary.
 

Colombia 

Since 2021, Colombia’s law has advanced national efforts to achieve carbon neutrality.
 

Law 2169 

This Law established goals and measures for carbon neutrality in Colombia by requiring public, private and mixed companies that fall in the criteria defined by the Ministry of Environment and Sustainable Development (which includes, among others, the level of GHG emissions and the company size), to report on direct and indirect (not defined whether Scope 2 and/or 3 emissions) GHG emissions. 

The Law also mandates that these companies provide information for the development of the inventory of GHG, and the Ministry determines the methodologies for calculating emissions, as well as the methods, instruments, and periodicity of the reports.
 

Mexico 

Lastly, Mexico has two regulations to manage companies’ GHG emissions.
 

Regulation of the General Law of Ecologic Equilibrium and Environmental Protection on Air Pollution Prevention and Control, and the Regulation of the General Climate Change Law regarding the National Emissions Registry 

These two Regulations require certain companies (such as chemical industries) emitting more than 25,000 tons of CO2eq per year to measure and report on their direct and indirect (Scope 2) GHG emissions every year. 

The Regulation of the General Climate Change Law also contains methodologies for calculating these emissions, as well as the methods, instruments, and periodicity of reports.