(The Center Square) — New York Gov. Kathy Hochul is being pressured to sign a bill requiring fossil fuel companies to pay a share of damage caused by climate change, but critics say the move will stifle innovation and drive up costs for energy consumers.
The Climate Change Superfund Act, approved by the Democratic-controlled Legislature during the final hours of its 2024 session, would authorize the state Department of Environmental Conservation to collect $75 billion from oil and gas companies over the next 25 years, averaging $3 billion a year. The money would be earmarked to pay for climate-related infrastructure upgrades like coastal wetlands restoration or stormwater projects.
The measure, modeled on the U.S. Environmental Protection Agency’s superfund program, targets high-emission corporations such as ExxonMobil, Shell and Chevron and mandates that they be held financially accountable for a portion of the costs of extreme weather damage in the state.
Environmental groups say New York taxpayers face rising costs to cover damages caused by climate change and argue that the oil companies must be on the hook for covering those costs.
“More intense heat results in more floods and tornadoes, rising sea levels threaten peoples’ homes, and hotter temperatures put New Yorkers in the emergency room,” Blair Horner, executive director of the New York Public Interest Research Group, said in a statement. “These all have human costs, but they have financial costs too. Governor Hochul must act to protect taxpayers by approving the Climate Change Superfund Act.”
The groups pointed out that Hochul approved $2.2 billion in taxpayer funding for climate-related infrastructure repairs and upgrades and resilience projects across the state last year.
“Governor Hochul has let two months of extreme heat go by without signing the Superfund Act to unleash billions of corporate dollars to keep us cool and our subways dry,” Eric Weltman, organizer with Food & Water Watch, said in remarks at a rally in support of the bill. “Instead of making New Yorkers wait for hours to splash in crowded, underfunded pools to keep cool, Hochul should be splashing corporate cash and making polluters pay for real solutions to climate-driven extreme weather.”
One of the bill’s primary sponsors, state Assemblyman Jeffrey Dinowitz, D-Bronx, says oil companies have for decades been “knowingly polluting our atmosphere to maximize their profits, and they continue to do so.” He is also urging Hochul to sign the bill into law.
“New Yorkers should not be footing the bill while these multinational oil companies continue to make money at record rates,” he said in a statement. “Big oil made this mess, and they should be the ones to pay the price and clean it up.”
If Hochul signs the bill and it survives expected legal challenges, New York will become the second state in the country to approve a law requiring oil and gas companies to pony up money for climate change.
Last month, Vermont became the first state after Republican Gov. Phil Scott allowed the Democratic-led bill to become law without his signature, citing concerns about the costs and impact of taking on the fossil fuel industry with limited state resources allocated.
Similar proposals have been introduced in California, Massachusetts and Maryland, according to the National Conference of State Legislatures.
The American Petroleum Institute, a trade group representing oil and gas companies, has blasted the new law as “bad public policy,” saying it “retroactively imposes costs and liability on prior activities that were legal, violates equal protection and due process rights by holding companies responsible for the actions of society at large; and is preempted by federal law.”
“This punitive new fee represents yet another step in a coordinated campaign to undermine America’s energy advantage and the economic and national security benefits it provides,” the group said in a recent statement.
