Q2 2026: Compliance instruments expand as carbon credit markets confirm new linkages
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Q2 2026 confirmed a broad expansion of compliance instruments across carbon, renewable energy, and clean fuels markets. The GHG Protocol and the AIM Platform each advanced how companies account for market instruments in April. SBTi followed with interim guidance on Green Gas Certificates in April and May, then released the final Corporate Net-Zero Standard V2.0 in June, formally recognizing environmental attribute certificates and book-and-claim systems, and introducing a new carbon credit expectation for the largest corporates.
Carbon credit markets moved in step with these standards. Virginia's return to RGGI and CARB's Cap-and-Invest amendments were confirmed in April. By June, California, Quebec, and Washington had signed a formal agreement to begin linking their carbon markets. In China, a binding provincial carbon peaking and neutrality framework confirmed in April 2026 points to rising demand for CCERs and GECs, reinforced in June by a national compliance mandate for renewable electricity consumption.
Other compliance instruments advanced in parallel. Germany secured EU approval for a €5 billion industrial decarbonization scheme, and Portugal and Brazil each confirmed biomethane compliance frameworks. In the US, continued delays to onshore wind permitting tightened near-term REC supply, while the Department of Energy's updated GREET model gave renewable fuel producers certainty on 2026 tax credit claims.
Read on to discover what these policy developments mean for you.
This round-up covers regulatory developments confirmed between April and June 2026. For full item-level analysis, see the monthly updates: April 2026 | May 2026 | June 2026
Global
Two standards bodies advanced how companies account for market instruments in April. The GHG Protocol's Scope 3 Technical Working Group published a Phase 1 progress update on its Corporate Value Chain Accounting and Reporting Standard, signaling a move away from spend-based emissions data toward activity-based and supplier-specific inputs, with a draft standard expected for consultation in Q3 2027. The Advanced and Indirect Mitigation Platform separately released Version 1.0 of its Standard and Guidance, giving companies a framework for identifying and accounting for value chain decarbonization investments.
SBTi issued two updates across the quarter. In April, version 1.3.1 of its Corporate Net-Zero Standard left the use of Green Gas Certificates for Scope 1 claims subject to individual verifier interpretation of interim GHG Protocol guidance. In June, SBTi released the final Corporate Net-Zero Standard V2.0, which formally recognizes high-integrity environmental attribute certificates and book-and-claim systems as legitimate tools for addressing emissions where direct abatement remains constrained. The Standard also introduces a new carbon credit expectation for the largest corporates, creating a medium-to-long-term demand signal for compliance-grade and high-integrity voluntary carbon instruments. Mandatory adoption applies from 2028, with voluntary early adoption available from 2026.
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Asia-Pacific
In April 2026, China released its first binding framework for assessing provincial progress toward carbon peaking and carbon neutrality goals, introducing pass/fail accountability for provincial governments across a "5+9" indicator system covering total emissions, carbon intensity, energy consumption, and non-fossil energy share. For buyers and sellers in China's GEC and CCER markets, the framework creates a structural demand driver as provincial governments face formal, career-affecting accountability for carbon intensity and non-fossil energy share. In June, the National Development and Reform Commission built on this with a national renewable energy consumption quota, effective August 1, 2026, that makes Green Electricity Certificates the sole accounting instrument for obligated companies in electrolytic aluminum, steel, cement, polysilicon, and data centers. Trial guidelines published the same month confirmed GECs as the compliance instrument of record and introduced a same-year match requirement, tightening the procurement window for obligated companies.
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Americas
North American carbon markets saw confirmed policy progress through the quarter and a formal linkage agreement by its end. In April, Virginia's Governor signed HB 397, confirming the state's return to RGGI with a target re-entry date of July 1, 2026, and CARB released modified regulatory text for its Cap-and-Invest program ahead of a May board vote, targeting a January 1, 2027 implementation date. Washington's linkage with the California-Quebec Western Climate Initiative was assessed as consistent with state climate law in April; by June, California, Quebec, and Washington had signed a formal agreement to begin the process of linking their carbon markets, with full linkage expected in 2027.
In the US renewable fuels and energy certificate markets, the Department of Defense's continued stalling of 160 onshore wind projects on private land was confirmed in May, removing an estimated 91 million RECs from near-term supply. In June, the Department of Energy released its updated 45Z GREET model, removing indirect land use change from the carbon intensity calculation and restricting feedstock eligibility to North America, providing renewable fuel producers the regulatory certainty needed to finalize 2026 tax credit claims.
In Brazil, the National Agency of Petroleum finalized a national biomethane certification framework in May, introducing mandatory annual biomethane targets for gas producers and importers, tracked through the Biomethane Origin Guarantee Certificate.
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Europe
Europe's regulatory activity concentrated in May. The European Commission approved a €5 billion German state aid scheme supporting heavy industry's move from fossil fuels to lower-carbon alternatives, including biomethane, electrification, hydrogen, carbon capture, and heat recovery, structured as two-way carbon contracts for difference across steel, cement, chemicals, glass, ceramics, paper, and metals. Portugal separately submitted its draft transposition of the EU's Renewable Energy Directive III, introducing biomethane blending targets reaching 9% of gas consumption by 2030 alongside binding advanced biofuel and RFNBO targets for road and maritime transport.
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Disclaimer
This content reflects regulatory developments confirmed as of 01-07-2026 and was accurate as of the date of publication. It is provided for general informational purposes only, is limited to confirmed developments, and does not purport to be comprehensive. Any forward-looking statements reflect the position as understood at the date of publication and are subject to change.
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