US Chamber, oil industry sue Vermont over law requiring companies to pay for climate change damage

Article content

MONTPELIER, Vermont (AP) — The U.S. Chamber of Commerce and a major oil and gas industry trade group have sued the state of Vermont over its new law requiring fossil fuel companies to pay a share of damages from climate change over several decades.

Article content

Article content

The federal lawsuit filed Monday asks a state court to block Vermont from enforcing the law passed last year. Vermont became the first state in the country to enact the law after suffering catastrophic summer flooding and damage from other extreme weather. The state has been working on estimating the cost of climate change dating back to January 1, 1995.

Advertisement 2

Article content

The lawsuit says the U.S. Constitution prohibits the act and that state law is preempted by the federal Clean Air Act. It also says the law violates the Domestic and Foreign Commerce Clauses by discriminating “against the important interests of other states by targeting large energy companies located outside Vermont.”

The chamber and the other plaintiff in the suit, the American Petroleum Institute, say the federal government is already addressing climate change. Because greenhouse gases come from billions of individual sources, they say it is impossible to “accurately and fairly” measure the impact of emissions from a particular entity in a particular location over decades.

“Vermont wants huge, retroactive penalties going back 30 years for lawful out-of-state conduct regulated by Congress under the Clean Air Act,” said Tara Morrissey, senior vice president and deputy chief counsel of the Chamber’s Litigation Center. “This is illegal and violates the structure of the U.S. Constitution — no single state can attempt to regulate a global issue that is best left to the federal government. Vermont’s sanctions will ultimately raise costs for consumers in Vermont and across the country.”

Article content

Advertisement 3

Article content

A spokesman for the state Natural Resources Agency said it had not been formally notified of the lawsuit.

Anthony Yarapino, a lobbyist for the Vermont-based Conservation Law Foundation, said the lawsuit was the fossil fuel industry’s way “to try to avoid accountability for the harms its products have caused in Vermont and beyond.”

“More states are following Vermont’s lead in holding big oil companies responsible for disaster recovery and cleanup costs from severe storms fueled by climate change, ensuring families and businesses don’t have to foot the full bill again and again,” Yarapino added.

Under the law, the Vermont Treasurer, in consultation with the Natural Resources Agency, shall issue a report by January 15, 2026, on the total cost to Vermonters and the state of emitting greenhouse gases as of January 1. From 1995 to December 31, 2024. The assessment will look at impacts on public health, natural resources, agriculture, economic development, housing and other areas. The state will use federal data to determine the amount of covered greenhouse gas emissions attributable to the fossil fuel company.

Advertisement 4

Article content

It is a polluter-driven model that impacts companies engaged in the trade or business of fossil fuel extraction or crude oil refining and accounts for more than one billion metric tons of greenhouse gas emissions over the time period. The state could use this money for things like improving stormwater drainage systems; developing roads, bridges and railways; Moving, raising or upgrading wastewater treatment plants; and perform energy-efficient weatherization upgrades in public and private buildings. It is modeled after the federal Superfund pollution cleanup program.

Vermont’s approach has attracted interest from other states, including New York, where Vermont Gov. Kathy Hochul signed a similar bill in December.

New York law requires companies responsible for significant greenhouse gas emissions to pay into a state fund for infrastructure projects aimed at repairing or avoiding future damage from climate change. The countries that emit the largest greenhouse gases between 2000 and 2018 will be subject to fines.

Article content

ChamberchangeClimateCompaniesdamageindustryLawOilpayRequiringSueVermont