California Legislature Enrolls Bill to Permit the Issuance of Take Authorization for Species Proposed for Listing Under CESA

Assembly Bill 550, enrolled and presented to the governor on September 3, 2026, would amend the California Endangered Species Act (CESA), Fish and Game Code Section 2081(b), to authorize the California Department of Fish and Wildlife (CDFW) to issue incidental take permits (ITPs) covering “species proposed for listing.” Under existing law, a developer cannot obtain an ITP for a species until it is declared a CESA “candidate” species, leaving a regulatory gap during the sometimes lengthy period between the initial petition or recommendation for listing (creating a species proposed for listing) and a candidacy determination. By expanding the universe of species eligible for take permits under certain circumstances, AB 550 would, if signed by Governor Newsom, narrow that gap.

The practical usefulness of this change, however, is largely, if not entirely, limited to certain renewable energy projects.

The legislative findings accompanying AB 550 grounded the bill in California’s aggressive climate and clean energy objectives, including the state’s mandate to achieve net-zero greenhouse gas emissions by 2045, generate 60% of its electricity from renewable sources by 2030, and transition to 100% zero-emission energy by 2045. California must nearly double its clean energy generation capacity within five years to meet these targets—an effort that requires the construction of large-scale solar, wind, geothermal, and other renewable electrical facilities in habitats occupied by sensitive species.

AB 550 would technically allow any project proponent to provisionally request formal take coverage under Fish and Game Code Section 2081 for a species merely proposed for listing. However, the bill singles out renewable electrical generation facilities for additional continuity-of-authorization protections in a newly proposed Fish and Game Code Section 2081.3. Specifically, AB 550 would insulate renewable electrical generation facilities alone from the need to seek additional authorizations or approvals if a species proposed for listing and covered by an ITP is later granted candidate, threatened or endangered status under CESA. Because projects not involving such facilities may be subject to further scrutiny and requirements if and when species proposed for listing are in fact listed, the changes proposed by AB 550 are of limited, if any, value to other industries, a conclusion that is further bolstered by the pointed focus of the Legislature on the need to aid a specific subset of energy projects.

Providing an additional permitting pathway for renewable energy generation projects could significantly reduce the risk of species-related disruptions during the lengthy development process, including construction. Since 2017, the California Fish and Game Commission (Commission) has received over 50 CESA listing petitions, many of which concern species present in areas well suited for renewable energy development. Notably, the western Joshua tree has been a candidate species since 2020, and its multi-year listing process created sustained uncertainty for developers with projects in California's desert regions, where Joshua trees are a defining feature of the landscape. The Center for Biological Diversity filed its petition to list the western Joshua tree on October 15, 2019, but the Commission did not designate it as a candidate species until September 24, 2020. Had AB 550 been in effect, project proponents would have had nearly a year's head start to secure an ITP before it was legally required.

Similarly, in October 2025, the Commission granted candidacy status to the western burrowing owl, a species with a range encompassing significant portions of California's Central Valley, desert regions, and coastal areas suitable for solar projects. The burrowing owl’s candidate status, granted in response to a petition filed on March 5, 2024, created significant uncertainty for the renewable energy industry. Developers ready to break ground and those already mid-construction flooded CDFW with ITP applications and inquiries. AB 550 would have given both project proponents and CDFW an additional seven months to actively process an ITP application and adapt to looming changes in law.

The Legislature also recognized the incidental benefits of AB 550 for the public at large. As AB 550’s supporting analysis acknowledges, even if CDFW endeavors to accommodate new, urgent requests for permits, delays caused by interruptions to energy projects already underway or on a strict deadline can result in liquidated damages amounting to $100,000 or more per day. Allowing developers to apply for ITPs for species proposed for listing before they are accepted as candidates improves planning timelines, reduces development uncertainty and associated costs, and enables proactive compliance, including early mitigation planning.

Proactive compliance, however, also carries a cost. Efforts to ease mitigation requirements in exchange for early permit coverage were unsuccessful. An earlier version of AB 550 included a provision that would have allowed scientific research to substitute for habitat conservation as a form of mitigation. This provision was removed, and additional revisions to the amendment’s structure ensured that the “fully mitigated” standard codified in Fish and Game Code Section 2081 would also apply to an ITP issued for a “species proposed for listing” under the AB 550 framework.

As such, projects obtaining coverage for species before they are listed under CESA would need to commit to standard, comprehensive compensatory mitigation for species that might not ultimately achieve listed status. CDFW rarely permits “true up” clauses in ITPs (i.e., provisions that would allow developers to reduce their mitigation obligations if circumstances change, such as when a species is not eventually listed). A limited exception may be when less acreage than planned is disturbed. Accordingly, even if a species covered by an ITP is not ultimately listed as threatened or endangered (or such listings do not occur in the geographic area of the project), the costs of adhering to the ITP’s mitigation requirements may still have to be incurred. Complicating matters, mitigation bank credits for “species proposed for listing” are largely unavailable because the incentives do not yet exist to create them, putting the onus on developers to formulate their own conservation solutions. Even with the new permitting options created by AB 550, developers will need to carefully weigh the risks and rewards of seeking an ITP for a species proposed for listing.

With the potential passage of AB 550, renewable generation project proponents developing in areas occupied by special status or sensitive species potentially eligible for CESA protections should frequently monitor the Commission’s Pending Petitions to List Species to identify species that may soon require ITP coverage so that they can make informed decisions about whether to begin the permitting process early. We will continue to monitor AB 550 and provide updates as needed. If you would like to learn more about how AB 550 may affect your project, please contact the Allen Matkins natural resources team.