Here’s how the 2025 legislative session closed: The lowdown on the environment

Gov. Gavin Newsom wrapped up the 2025 legislative session with the usual flurry of activity, signing several important environmental, energy and climate bills and vetoing others ahead of Monday’s deadline.

Among the newest laws in California are efforts to accelerate clean energy projects and advance the state’s position as a climate leader — but also decisions to ramp up oil drilling and reject the phase-out of forever chemicals.

Here’s a look at what happened this year:

In September, Newsom signed a blockbuster suite of bills including the reauthorization of California’s signature cap-and-trade program, which sets limits on greenhouse gas emissions and lets large polluters buy and sell emissions allowances at quarterly auctions. The Legislature extended the program by 15 years to 2045, rebranded it as “cap-and-invest” and specified how its revenues will be allocated for wildfire prevention efforts, high-speed rail and other projects.

The greenhouse gas trading program is seen as essential for the state to meet its climate targets, including reaching carbon neutrality by 2045.

“California really needed to act this year to decisively try to put in policies to meet our climate goals [and support] the economy and different sectors,” said Susan Nedell, senior western advocate with the nonpartisan policy group E2. She called state legislative efforts especially important as the Trump administration aims to erode California’s authority on tailpipe emission standards, electric vehicle initiatives and renewable energy projects, among others.

“This is the time for California to lead, and I really feel like they came through on it as a state,” Nedell said.

WHAT ELSE BECAME LAW

• One of the more controversial bills of the year was Senate Bill 237, which makes it easier to drill up to 2,000 new oil wells in Kern County. It’s a tradeoff that also makes it more difficult to drill new oil or gas wells offshore. Legislators said it will help address the volatility of gasoline prices following announcements from oil companies Phillips 66 and Valero that they are shutting down two big refineries in the state. Environmental groups were quick to condemn the bill.
• Also controversial was Assembly Bill 825, which will expand California’s participation in a regional power market — enabling the state to buy and sell more clean power with other Western states. Opponents feared that it will cede some control of California’s power grid to out-of-state authorities, including the federal government. Supporters said it will improve grid reliability and save money for ratepayers.
• January’s firestorm in L.A. led to a renewed focus on the state’s approach to fires, including Senate Bill 254, which contains various policies to address California’s aging electric infrastructure and wildfire prevention goals. It will secure about $18 billion to replenish the state’s wildfire fund — a state insurance policy for utilities — which officials say will help protect ratepayers from excessive utility liability costs. It also will establish a program to speed up the construction of power lines needed for clean energy projects.
• Assembly Bill 39 requires cities and counties with at least 75,000 residents to plan for more electrification infrastructure by 2030, including electric vehicle charging and building upgrades. The measures must address the needs of low-income households and disadvantaged communities.
• Senate Bill 80 will create a $5-million fund to accelerate research and development for fusion energy. Fusion creates energy by slamming two atoms together. The state hopes to launch the world’s first fusion energy pilot project by the 2040s. “Fusion energy has the immense potential to provide consistent, clean baseload power on demand that will help us meet our clean energy goals,” said Sen. Anna Caballero (D-Merced), the bill’s author, in a statement.
• Assembly Bill 888 creates a grant program to help low-income homeowners clear defensible space around their houses and install fire-safe roofs. It is “exactly the kind of proactive, people-first policy California needs,” said Eric Horne, California director for the nonprofit Megafire Action, which is geared to ending large wildfires.
• Senate Bill 653 means that state agencies have to pay more attention to using native species in their fire prevention work and use science-based standards to avoid introducing invasive, fire-prone species.
• Senate Bill 429 establishes the Wildfire Safety and Risk Mitigation Program at the California Department of Insurance, which will fund research into developing and deploying a public wildfire catastrophe model — a computer simulation that estimates property damage from large wildfires and helps communities better assess and prepare for risk.
• Assembly Bill 462 streamlines approvals for accessory dwelling units on properties affected by the 2025 wildfires in the California Coastal Zone, requiring decisions on coastal permits within 60 days and eliminating some appeals.
• Assembly Bill 818 accelerates local permitting for rebuilding homes and allows residents to place temporary homes, such as manufactured homes or ADUs, on private lots during reconstruction.
• Assembly Bill 245 gives residents additional time to rebuild their homes or businesses in the wake of the 2025 wildfires without experiencing a property tax increase.

• Senate Bill 614 will establish new regulations for the safe transport of carbon dioxide captured from large polluters or removed from the atmosphere. The legislation will authorize the development of dedicated pipelines to move CO2 to underground geological formations for permanent storage, and was described by Newsom as a vital next step for the state’s burgeoning carbon capture, removal and sequestration market.
• Assembly Bill 14 expands the “Protecting Blue Whales and Blue Skies Program” statewide. The program encourages large vessels to voluntarily reduce their speed in designated areas in order to reduce air pollution and reduce the risk of fatal vessel strikes and harmful underwater acoustic impacts on whales.

WHAT WAS VETOED

• The governor vetoed Senate Bill 34, which would have required the South Coast Air Quality Management District to consider certain factors before implementing regulations at the region’s ports. Opponents, including health and environmental groups, said it would have ultimately weakened its authority and ability to meet clean air standards. In its place, the air district and the ports are pursuing a voluntary cooperative agreement that will include obligations for zero-emissions infrastructure and other clean-air efforts. “With the current federal administration directly undermining our state and local air and climate pollution reduction strategies, it is imperative that we maintain the tools we have,” Newsom wrote in his veto.
• Assembly Bill 740 would have directed the state’s energy agencies to create an implementation plan for “virtual power plants” — networks of small energy resources such as smart thermostats, home batteries and rooftop solar panels that can help reduce strain on the grid. Newsom vetoed it earlier this month, stating that it would result in additional costs for the California Energy Commission’s already depleted operating fund. But Edson Perez, California lead at the nonprofit Advanced Energy United, called its veto a “costly mistake” and said the bill would have saved ratepayers more than $13 billion.
• Newsom this week also vetoed Senate Bill 682, which would have phased out the use of perfluoroalkyl and polyfluoroalkyl substances, known as PFAS, or “forever chemicals,” in consumer products such as nonstick cookwear and products for infants and children. The governor cited concerns about affordability in his veto.

Earlier this year, the governor also signed the most significant reforms to the California Environmental Quality Act, or CEQA, since it originally became law in 1970. Signed in June, Assembly Bill 130 and Senate Bill 131 exempt a broad array of housing development and infrastructure projects from CEQA in an effort to ease new construction in the state. Supporters said it will help address the state’s housing crisis, while many environmental groups were outraged by the move.

“While California was able to advance on grid regionalization, strengthen energy affordability, uphold local air quality protection, and protect endangered species, we’re frustrated by the Governor’s vetoes of measures that would have banned forever chemicals, prioritized cost effective energy consumption, expanded virtual power plants to lower electricity bills, and banned microplastics,” said Melissa Romero, policy advocacy director with the nonprofit California Environmental Voters.