Report: SEC plans to scale back climate rule

The SEC may significantly weaken planned rules on corporate emissions disclosures, the outlet Semafor reportsBen writes.

Driving the news: The change would scuttle mandates that public companies reveal “Scope 3” emissions, it reports.

  • That refers to emissions from use of companies’ products in the economy or, for financial institutions, from their portfolio companies.
  • The SEC, which issued draft rules in March, declined comment.

Why it matters: These emissions can dwarf what comes from companies’ direct operations and the energy that powers them.

For instance, oil companies’ Scope 3 emissions — such as gas burned in cars — are by far the biggest share of their total greenhouse gases.

The intrigue: Some big industries have been fighting the inclusion of Scope 3, or trying to scale back the requirements, calling the cost and complexity a major burden.

  • More broadly, many companies, trade groups and environmentalists are intensely lobbying to shape the first-time mandates.
  • The rule, which is behind schedule for completion, will also face litigation.
  • Plaintiffs will likely claim it runs afoul of June’s Supreme Court ruling that limits executive power without clear congressional instruction.