Vermont has passed a first-in-the-nation law that will require “Big Oil” to pay for damages caused by climate change, the long-term change in weather patterns that is heavily influenced by fossil fuel emissions.
Vermont Gov. Phill Scott sent a letter to the state's General Assembly on Thursday allowing the measure, which proposes to establish 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 from a well-funded defense, we are not positioning ourselves for success,” he said. “I am deeply concerned about the costs and outcomes in both the short and long term.”
Big Oil, the world's largest oil and gas companies, is primarily dependent on fossil fuels for their business, which are “by far the largest contributor to global climate change,” according to the United Nations. The international group says fossil fuels account for more than 75 percent of greenhouse gas emissions, which trap heat in the atmosphere and raise global temperatures, leading to more extreme weather events.
Vermont is no stranger to the impacts of extreme weather. Last summer, the state was hit by catastrophic flooding after a estimated rain in two months fell in two days, an amount so significant and damaging that NOAA classified it as a billion dollar disaster. The excess precipitation left entire villages isolated and at one point, a train track hanging in the air. As global temperatures rise, it causes precipitation to increase, fueling storm systems.
The Natural Resources Agency would oversee the cost recovery program, which would assess a “cost recovery claim” for any entity or successor in interest to an entity that would engage in the extraction of fossil fuels or the refining of crude oil Entities would only have to pay if the Agency determines that their products emitted more than one billion metric tons of greenhouse gases from January 1, 1995, to December 31, 2024.
Money raised through this process would then go 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 is a big step forward in ensuring that responsible parties, like Big Oil, companies like ExxonMobil and Shell who have known for decades that their products are altering the climate, also have to pay a fair share of the costs of cleaning”. said the Vermont Natural Resources Council before the governor's official approval.
In an April letter to the Vermont House, the American Petroleum Institute, the oil and gas industry's largest lobbying group, said it opposed the “bad public policy” because it “does not is the means of effecting' the purpose of the bill.
“API is deeply concerned that the bill: retroactively imposes costs and liabilities on past activities that were legal, violates equal protection and due process rights on the part of holding companies responsible for the actions of society at large; and federal law removes it,” the letter said. states “Furthermore, the bill fails to provide potentially affected parties with notice of the magnitude of the potential fees that may result from its passage.”
In his announcement of the bill's passage, Scott said he is aware the new law will face legal challenges. He noted, however, that the state attorney general and treasurer endorsed it and that the Natural Resources Agency will have to submit a feasibility report in January.
Vermont state Rep. Martin LaLonde said in a statement that the bill took into account legal input, saying he believes “we have a strong legal case.”
“Most importantly, the stakes are too high, and the costs too high for Vermonters, to release the corporations that caused the mess from their obligation to help clean it up,” he said.
