In historic move, Vermont becomes 1st state to pass law requiring fossil fuel companies to pay for climate change damages

Vermont has passed a law, the nation’s first, that will require “Big Oil” to pay for the damage caused by climate change, the long-term change in weather patterns that is heavily influenced by fossil fuel emissions.

Vermont Governor Phill Scott sent a letter to the state General Assembly on Thursday allowing the measure, which proposes the creation of the Climate Superfund Cost Recovery Program, to become law without his signature. In that letter, Scott said that “taking on ‘Big Oil’ should not be taken lightly.”

“With only $600,000 appropriated by the Legislature to complete an analysis that will have to withstand intense legal scrutiny for a well-funded defense, we are not positioning ourselves for success,” he said. “I am deeply concerned about the short- and long-term costs and outcomes.”

“Big Oil” — the world’s largest oil and gas companies — rely primarily on fossil fuels for their business, which is “by far the biggest contributor to global climate change,” according to the United Nations. The international group says fossil fuels are responsible for more than 75% of emissions of greenhouse gases, which trap heat in the atmosphere and increase global temperatures, leading to more extreme meteorological phenomena.

Vermont is no stranger to the impacts of extreme weather. Last summer, the state was hit by catastrophic flooding after a estimated two months of rain fell in two days, an amount so significant and damaging that NOAA classified it as a billion dollar disaster. Excessive precipitation left entire cities isolated and, at one point, a train tracks hanging in the air. As global temperatures rise, precipitation increases, fueling storm systems.

The Natural Resources Agency would oversee the cost recovery program, which would assess a “cost recovery demand” for any entity or successor interested in an entity that was in the business of extracting fossil fuels or refining crude oil. Entities would only be required to pay if the Agency determined that their products emitted more than one billion metric tons of greenhouse gases between January 1, 1995 and December 31, 2024.

The money collected through this process would then be placed into the superfund, which will be used to help the State adapt to climate change and develop more climate-resilient infrastructure.

New York, California, Massachusetts and Maryland are also considering similar legislation.

“This bill represents a major step forward in ensuring that responsible parties like Big Oil – companies like ExxonMobil and Shell, which have known for decades that their products are disrupting the climate – are made to pay as well. a fair share of the cleaning costs.” O Vermont Natural Resources Council said before the governor’s official approval.

On a April letter To the Vermont House, the American Petroleum Institute, the oil and gas industry’s largest lobbying group, said it opposed “bad public policy” as it is “not the way to accomplish” the bill’s goal.

“API is extremely concerned that the bill: retroactively imposes costs and liabilities on prior activities that were lawful violates equal protection and due process rights by holding companies accountable for the actions of society at large; and is barred by federal law,” the letter states. “Further, the bill does not warn potentially affected parties of the magnitude of potential fees that could result from its passage.”

In announcing the bill’s passage, Scott said he was aware that the new law would face legal challenges. He noted, however, that the attorney general and state treasurer have approved the proposal and that the Natural Resources Agency will have to submit a feasibility report in January.

Vermont State Representative Martin LaLonde said in a declaration that the bill took into account input from legal scholars, saying he believes “we have a solid legal case.”

“More importantly, the risks are too high – and the costs too high for Vermonters – to relieve the companies that caused the mess of their obligation to help clean it up,” he said.