How do you budget for a year when compliance costs are climbing, energy prices swing like a pendulum, and climate disruptions don’t wait their turn? If you’re building a 2026 budget, you’re doing it in a very different operating environment than even a year ago. Disclosure rules are tightening, energy costs remain volatile, and climate-driven disruptions are getting pricier and more frequent. In this context, a sustainability line item isn’t a “nice to have,” it’s how you stay compliant, control costs, and protect continuity.  

To help you adjust to this changing environment, we’re going to take a look at the top three forces causing this change and what you can do to adapt your budget to this new landscape.  

1) Scope 3 Reporting Is Becoming a Business Requirement  

First, regulators are amplifying what customers and investors already want: greater visibility into supply-chain emissions. Even if you don’t fall under the requirement to report, your largest buyers and lenders may fall within the regulatory criteria and push upstream for Scope 3 data. This means now’s the time to budget for systems, supplier engagement, and assurance-ready documentation. You don’t want to be scrambling later. 

Key Drivers of This Demand 

Leading the charge in the U.S. is California’s SB 253, which requires large companies doing business in the state to disclose Scopes 1, 2, and 3 emissions data. Implementation is on a phased schedule, requiring Scope 1 and 2 reporting in 2026 and adding in Scope 3 reporting in 2027. SB 261 adds biennial reporting for climate-related financial risks and the mitigation strategies a company is taking to address those risks. 

Meanwhile, the EU’s Corporate Sustainability Reporting Directive (CSRD) expands sustainability reporting to many non-EU multinational companies with significant EU revenue or EU-listed securities. This pushes consistent Scope 1, 2, and 3 emission reporting to a significant number of larger international companies. Together, these rules make Scope 3 data a requirement for large B2B sellers. 

How This Impacts You 

Expect questions from customers, new contract language around emissions categories, and requests to substantiate calculations. You should start budgeting for data tracking systems, begin tracking high-impact categories, and reach out to your suppliers to ensure your responses are accurate and consistent with SB 253 and CSRD expectations. If you need a primer on where to start, check out our overview of what successful GHG emission reporting looks like and how to avoid common pitfalls. 

2) Rising Energy Prices Will Hit Your Bottom Line 

Next up are the market dynamics, which indicate that energy prices are on the rise due to growing demand in power-intensive sectors and uncertainty in fuel prices. The U.S. Energy Information Administration (EIA) anticipates that retail energy prices will continue to outpace inflation during 2026. Energy already makes up over one-third of typical operating costs for commercial buildings, and this is only increasing. 

Efficiency and Demand Management Hedge Risk 

This is a not-so-subtle reminder that improving energy efficiency is critical in the near term. A “wait and see” strategy can quickly become “over budget.”  

Investing in energy efficiency and renewable energy can drastically cut your utility bill. Options like improving lighting, which typically accounts for 17% of commercial energy use, or investing in appliance upgrades can go a long way. More significant options, such as installing on-site solar panels, can have an even larger impact.   

Many options come with short payback periods and create a practical hedge against price volatility. Additionally, federal funding and incentives remain available until the end of 2025, and local options will be available afterwards. If you need help scoping where the value is, our energy audit service translates usage data into a prioritized, cost-effective plan you can budget against.  

3) Climate-Driven Disruptions Threaten Business Continuity 

Taming energy price risk is only half the equation. The other half is keeping the lights on when the grid, your facilities, or your supply routes are under stress. The physical risk trend is moving in the wrong direction. 

NOAA confirmed 27 separate billion-dollar weather and climate disasters in the U.S. in 2024, well above the average of 9 annual disasters between 1980 and 2024. Furthermore, NOAA’s multi-decade time series shows a clear increase in both frequency and cost of these events.  

These events translate into real business interruptions, including facility damage, downtime, logistics delays, workforce dislocation, and reputational damage when service levels slip. Designing resilience into projects beats emergency retrofits on both cost and disruption. 

The ROI of Mitigation 

The business case for resilience is strong. Independent analysis from the National Institute of Building Sciences finds multiple dollars of future loss avoided for every dollar invested in mitigation, with adopting and enforcing modern building codes among the most cost-effective steps available to owners and communities. 

In practice, this means budgeting now for site-specific risks. Depending on the location, this could involve designing for floods, wind, fire, and heat, or reliable power sized to meet your critical loads. Adding these measures to planned capital projects, rather than bolting them on after an event, reduces total cost, shortens downtime, and keeps operations intact. 

Funding Can Stretch Your Investment Further 

If controlling energy costs and hardening facilities are the “what,” funding is the “how.” The good news is you don’t have to shoulder every dollar on your balance sheet. The most effective programs we see pair a clear technical roadmap with a financing plan that sequences projects to capture incentives first, then fills remaining gaps. 

Start by mapping incentives before you lock scope or dates. With federal incentives set to largely expire at the end of 2025, state and local incentives are the next best option. The Database of State Incentives for Renewables & Efficiency (DSIRE) is the fastest way to scan active utility, state, and municipal programs and view funding calendars for applications.  

From there, you can look to Commercial Property Assessed Clean Energy (C-PACE) to bridge the gap. C-PACE offers long-term fixed financing at favorable rates. In many jurisdictions, it can fund energy efficiency, on-site renewables, and certain resilience upgrades. 

2026 Is the Year to Align Budgets with Business Goals 

Put simply: compliance, cost control, and resilience all point to the same conclusion. Sustainability requires a clear, measurable line item in your 2026 budget, along with accountable KPIs and audit-ready files that make SB 253/CSRD assurance routine rather than a last-minute scramble.  

At Emerald Built Environments, A Crete United Company, our sustainability consultants help you translate policy into performance. We bring the engineering depth, data discipline, and program experience to prioritize, fund, and deliver results. The outcome: a budget that not only meets regulations but also strengthens operations, lowers energy spend, and protects business continuity. 

From a Scope 3 engagement program to an energy audit and retrofit roadmap, or a resilience upgrade built into your capital plan, our sustainability consultants deliver strategies that meet compliance today and strengthen performance for the future. 

Don’t wait until regulations or rising costs force your hand — get ahead of 2026 by building sustainability into your financial strategy today.