Vermont passed an unprecedented new law requiring oil companies to pay for damages caused by climate change. The bill, which became law without the governor’s signature due to a veto-proof majority, still has a ways to go before being implemented. In fact, the bill allocates $600,000 to research how the program will function and to build a defense to inevitable court challenges. The Hill writes:
“The state’s Climate Superfund Act is modeled on federal Superfund law and seeks to assess financial penalties for emissions generated between 1995 and 2024, which could total billions of dollars. The bill passed the state House in a 94-38 vote May 7, a margin just shy of a supermajority. In an earlier procedural vote, it received a veto-proof 100 votes, suggesting the Legislature had the votes to override a veto from Scott’s office.”
Several other states are considering similar bills in their legislatures, but Vermont’s is the first to become law. This law is another new regulatory risk for oil companies which are already facing substantial third party legal risks over the effects of climate change. As the damage from climate change continues to mount, we can expect to see more states and municipalities seeking to recover damages from carbon majors. Whether this primarily takes the form of litigation or new laws remains to be seen, but ultimately someone will be held responsible for reconstruction and climate-proofing costs. That burden will likely be shared between the taxpayer and fossil fuel companies.
Our members can find more information on developing climate litigation and regulatory enforcements here.
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