New York’s New $75 Billion Climate Law – Legal, Economic, and Scientific Questions – Watts Up With That?

On December 26, 2024, New York Governor Kathy Hochul signed the Climate Change Superfund Act into law. This legislation seeks to collect $75 billion from fossil fuel companies over 25 years to fund climate-related infrastructure and adaptation projects. Framed as a mechanism to hold the fossil fuel industry accountable, the law raises serious questions about its legal, economic, and scientific basis.

The Framework and Purpose of the Law

The Climate Change Superfund Act requires fossil fuel companies deemed responsible for over 1 billion metric tons of greenhouse gas emissions between 2000 and 2018 to contribute to a state-run fund. This fund will distribute $3 billion annually for projects including coastal restoration, stormwater drainage improvements, and infrastructure upgrades in areas labeled as “disadvantaged communities”​​.

The law is modeled after state and federal superfund programs for toxic waste but operates under strict liability. Companies are required to pay based on their historical emissions, regardless of whether they acted within legal boundaries at the time or whether their products were essential to modern life​.

Legal and Economic Concerns

Federal Preemption and Constitutional Issues

The fossil fuel industry has signaled its intent to challenge the law on the grounds that it conflicts with federal regulations governing energy and environmental policy. The principle of federal preemption under the U.S. Constitution could be a major obstacle for the state. Additionally, the retroactive application of liability raises due process concerns. Holding companies financially responsible for activities that were lawful at the time represents an unprecedented legal approach​​.

Economic Impact

The financial burden placed on fossil fuel companies will almost certainly lead to higher costs for energy and other goods, as these companies pass expenses onto consumers. New York residents, already struggling with high taxes and living costs, may indirectly bear the weight of this legislation. The state asserts that these fines will offset taxpayer expenses for climate adaptation, but it is unclear whether the funds will be used efficiently or effectively.

Legal Precedent for Other States

Vermont recently enacted a similar law, and New York’s approach may inspire other states to follow suit. However, this could lead to a fragmented regulatory landscape, complicating interstate commerce and increasing operational uncertainty for businesses. Such a patchwork of laws could discourage investment and innovation in the energy sector.

Questions About the Law’s Scientific Basis

The legislation asserts that it is now possible to calculate, with “great accuracy,” the share of greenhouse gas emissions attributable to specific companies. This claim is highly debatable given the inherent complexity of attributing emissions to individual actors in a global system.

Selective Timeframe

The law targets emissions from 2000 to 2018, a period chosen on the grounds that climate science was allegedly “well-established” by 2000. However, this timeframe excludes earlier decades when industrial activity also contributed to atmospheric changes. Such selective accounting raises questions about the fairness and objectivity of the law​.

Ignoring Broader Responsibility

Fossil fuel companies are not the only entities contributing to emissions. Governments, industries, and consumers who relied on these products played an active role in the demand for fossil fuels. By focusing exclusively on producers, the legislation narrows the accountability framework, ignoring the interconnectedness of energy consumption and economic development.

Policy and Practical Implications

Funding Allocation and Efficiency

While the law outlines a broad scope of projects for its Climate Change Superfund, history suggests that government-managed programs are prone to waste, corruption, and inefficiency. The provision mandating that 35–40% of funds benefit disadvantaged communities adds a layer of complexity and likely waste, creating mass potential for political and bureaucratic inefficiencies in fund allocation​.

Alternative Approaches: A Call for Prudence

Rather than rushing into punitive measures or alternative schemes, policymakers should first grapple with the inherent uncertainties in climate science. Predicting future impacts and attributing past effects to specific actors remains a highly speculative exercise. Imposing penalties or market-driven mechanisms like carbon pricing assumes a degree of precision that current climate science simply does not support.

Instead, energy policy might better focus on resilience and diversification, decoupled from climate assumptions. This includes ensuring reliable energy grids, maintaining affordable energy access, and encouraging voluntary, market-driven innovation—not as a reaction to apocalyptic scenarios but as a path toward general technological advancement and economic stability.

Conclusion: Questioning the Premise

The Climate Change Superfund Act exemplifies the risks of policymaking built on uncertain science. It presumes the ability to quantify historic emissions accurately, assign blame equitably, and predict future consequences reliably. None of these premises hold up under scrutiny. The law’s retroactive liability framework and its economic consequences—both direct and indirect—introduce risks that could outweigh any speculative benefits.

While it claims to champion accountability and adaptation, the Act sets a troubling precedent. By targeting fossil fuel companies without addressing the broader societal reliance on these fuels, it distorts the very nature of responsibility. Worse, by embracing an uncritical view of climate science, it risks committing New Yorkers to years of increased costs and litigation with no guarantee of measurable benefits.

Rather than adopting policies driven by climate alarmism, governments should adopt a position of restraint. Policies based on uncertain science and contested models may well cause more harm than good. Policymakers should prioritize transparency, resist dogmatic pressures, and ensure that any interventions are grounded in sound science, clear economic benefits, and respect for legal principles. New York’s Climate Change Superfund Act may be ambitious, but misguided ambition without clarity is more likely to harm than to help.