Federal judge blocks New York's $75 billion climate superfund law, ruling it intrudes on federal authority
A federal judge has struck down New York's ambitious plan to make fossil fuel companies pay $75 billion toward the cost of climate change damage, ruling that the state's 2024 Climate Superfund Act oversteps its authority and conflicts with federal law and U.S. foreign policy.
U.S. District Judge Brenda Sannes said Monday the law, signed by Gov. Kathy Hochul, sought damages for the cumulative impact of greenhouse gas emissions produced around the world — territory that has been governed by federal law for more than a century. The Clean Air Act assigns the U.S. Environmental Protection Agency primary responsibility for regulating planet-warming emissions, Sannes wrote, and allowing each state to pursue its own liability regime would undermine the need for a uniform national energy and environmental policy.
Sannes separately found that forcing foreign fossil fuel producers to pay into the state fund was preempted by the foreign affairs doctrine, making that portion of the law unconstitutional.
New York's law would have required companies responsible for substantial greenhouse gas emissions between 2000 and 2018 to collectively pay $3 billion a year for 25 years. The money was to be used for infrastructure projects meant to repair damage from extreme weather and help communities prepare for future climate impacts, including coastal wetland restoration and upgrades to roads, bridges, and stormwater systems. Supporters compared the approach to the federal Superfund program, which forces polluters to pay for toxic waste cleanups.
The law was challenged by fossil fuel companies, business groups including the U.S. Chamber of Commerce, 22 Republican state attorneys general, and the Environmental Protection Agency. The Trump administration, which has declared a "national energy emergency" and urged action against state energy policies it regards as overreaching, welcomed the decision.
"New York's law would have expropriated $75 billion from energy companies around the world during an energy emergency and in direct defiance of American foreign policy and federal law," Adam Gustafson, a principal deputy assistant attorney general, said in a statement. The Justice Department said it was "delivering on President Trump's order to protect American energy from state overreach."
Climate change activists urged Hochul's administration to appeal. A spokesperson for the governor said "taxpayers shouldn't have to foot the bill for damages caused by polluters" and that the administration was reviewing the decision and weighing next steps. An appeal would go to the 2nd U.S. Circuit Court of Appeals.
The decision is a significant setback for the climate superfund movement and is likely to reverberate beyond New York. The Trump administration has also moved against similar climate liability laws in Michigan, Hawaii, and Vermont. The outcome of those fights, and any appeal by New York, could help determine whether states can use their own laws to make the fossil fuel industry pay for global climate damage when the federal government has declined to act.