AB 1911: Advertising: environmental marketing claims: carbon credits.

17580.7.

(a) It shall be a defense to In any suit or complaint brought under Section 17580.5 if the person’s 17580.5, a defendant’s environmental marketing claim is presumed to be valid if the defendant complies with Part 10 (commencing with Section 44475) of Division 26 of the Health and Safety Code and the claim is based on the voluntary use of a carbon credit issued by a carbon crediting program that meets any of the following requirements:

(1) The carbon crediting program is approved by the State Air Resources Board pursuant to Section 95986 of Title 17 of the California Code of Regulations.

(2) The carbon crediting program is approved by the International Civil Aviation Organization to supply credits for use in the Carbon Offsetting Reduction Scheme for International Aviation.

(3) The carbon crediting program satisfies the criteria set forth in subdivision (b). (b) and appears on the list published by the State Air Resources Board pursuant to subdivision (c).

(b) A program shall qualify as a carbon crediting program for purposes of paragraph (3) of subdivision (a) if it does all of the following:

(1) Adopts clear methodologies and protocols with transparent development processes that accommodate public input, and publicly discloses all approved quantification methodologies.

(2) Defines and publicly discloses the level at which activities are allowed, for example example, project based, program of activities, and eligibility criteria for each type of credited activity.

(3) Establishes and publicly discloses procedures for how carbon credits are discounted, issued, retired or canceled, and the length of the crediting period.

(4) Has mechanisms and procedures to do all of the following:

(A) Track units in a publicly accessible registry.

(B) Individually identify units through serial numbers or other unique identifiers.

(C) Provide a secure registry.

(D) Clearly identify unit holders.

(5) Has in place program-level requirements for robust independent third-party validation and verification of mitigation activities, including the establishment and enforcement of oversight standards for validation and verification bodies that comply with the requirements of subdivision (d) and perform an annual examination of a representative sample of project validations and verifications.

(6) Has and discloses an effective program governance structure that ensures transparency, accountability, and continuous improvement and the overall quality of carbon credits, and has a program governance structure that meets all of the following criteria:

(A) It has a board comprising independent board members who assume a fiduciary responsibility for the organization and operate according to robust bylaws and have established processes for addressing conflicts of interest.

(B) It publishes an annual report containing the organization’s revenues, expenses, and net assets.

(C) It has robust anti-money laundering processes in place and follows practices consistent with robust antibribery and anticorruption guidance and regulation.

(7) Publicly discloses in an electronic format accessible to nonspecialized audiences all of the following:

(A) What information is captured and made available to different stakeholders.

(B) Local stakeholder consultation requirements.

(C) Public grievance and consultation provisions and requirements, and how they are considered.

(8) Has clear guidance, tools, and compliance procedures to ensure mitigation activities conform with or go beyond widely established industry best practices on social and environmental safeguards while delivering positive sustainable development impacts.

(9) Provides information on how it addresses double counting and double issuance and double claiming in the context of evolving national and international regimes for carbon credit markets and tracking.

(10) Has provisions that ensure the mitigation activity shall be permanent or, where there is a risk of reversal, have has measures in place to address those risks or compensate for reversals.

(c) (1) Within ____ days of On or before January 1, 2027, 2028, the State Air Resources Board shall publish and maintain a list of carbon crediting programs that satisfy the requirements of subdivision (b).

(2) Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code does not apply to the publication and maintenance of the list pursuant to paragraph (1).

(d) An entity shall qualify as a third-party credit validation and verification body for purposes of subdivision (b) if it satisfies either of the following:

(1) Any of the accreditation requirements set forth under Sections 95132 and 95978 of Title 17 of the California Code of Regulations.

(2) All of the following requirements:

(A) Be It shall be accredited by an International Accreditation Forum (IAF) Multilateral Recognition Arrangement recognized accreditation body for International Organization for Standardization (ISO) 14065 and ISO 14064-3 in the applicable sectoral scope to conduct validations or verifications, or both, or under an equivalent approved accreditation body covering the scope of that regulation under the most current version of ISO 14065 in the applicable sectoral scope to conduct validations or verifications, or both.

(B) Be It shall be competent to carry out validation and verification under the requirements of the respective carbon crediting body.

(C) Have It shall have policies in place to identify and mitigate financial and all other conflicts of interest and is shall not be a mitigation project developer or proponent, the owner of a mitigation project developer or proponent, or be owned by them.