California lawmakers have long sought to hold fossil fuel companies accountable for the damages incurred due to their emissions, including the worsening of natural disasters such as wildfires and floods, as well as rising costs associated with climate recovery and adaptation.
Despite multiple efforts, the latest proposals, Senate Bill 684 and Assembly Bill 1243, known as the Polluters Pay Climate Superfund Act, have once again stalled in Sacramento amid significant lobbying by the industry.
These bills aimed to compel the largest oil and gas companies operating in California to pay for their fair share of damages attributed to greenhouse gas emissions.
The funds collected would be set aside in a Superfund account to finance projects and programs designed to help the state address climate change issues.
Momentum for the legislation grew following the devastating wildfires in Los Angeles in January, but unfortunately, neither bill advanced past its initial legislative hurdles and was put on hold until the next year.
A similar bill that was introduced last year by Senator Caroline Menjivar also failed to make significant progress, with only three committees approving it before it met its end in the Senate appropriations.
California’s efforts contrast sharply with states like New York and Vermont, both of which successfully passed analogous legislation last year.
In California, the fossil fuel industry has mounted fierce resistance against these climate-related bills, as rising federal directives for oil and gas production also play a role in shaping the legislative landscape.
In just the first quarter of this year, fossil fuel companies and other lobby groups spent over $10.6 million to oppose the Climate Superfund Act, dwarfing the financial support from environmental organizations advocating for its passage.
Assemblymember Dawn Addis remarked that combating Big Oil’s influence has been immensely challenging.
Despite the state’s commitment to climate leadership, fossil fuel interests have focused their efforts on stalling progress in California.
The Climate Superfund Act is designed after the federal Superfund law, which necessitates that companies assume responsibility for cleaning up contamination resulting from their activities.
In this instance, the California Environmental Protection Agency would be tasked with identifying responsible parties—specifically, those oil companies accountable for more than 1 billion metric tons of CO2 emissions globally between 1990 and 2024—within 90 days of the law’s enactment.
The agency would then have a year to thoroughly evaluate and assign damages based on each company’s emissions during that period, assessed as a one-time fee payable in annual installments into the Superfund.
Proponents of the legislation underscore its importance and timeliness.
Maggie Coulter, a senior attorney with the Center for Biological Diversity’s Climate Law Institute, attests that those who create environmental harm should be responsible for its remediation rather than taxpayers bearing the financial burden.
Fossil fuels account for approximately 75% of greenhouse gas emissions, which significantly fuel global warming and contribute to increasingly frequent and destructive natural disasters.
The fallout from climate-related events encompasses more than just property damage; it affects healthcare expenses, insurance costs, emergency disaster responses, and infrastructure repairs, costs that typically fall on the public.
State Senate officials noted in their analysis that significant financial implications accompany the consequences of climate change, with wildfires in California alone resulting in over $19 billion in economic losses in 2020 and damages from January’s fires in Los Angeles estimated to be around $250 billion.
“Whether or not this bill is passed, the expenses related to climate disaster recovery, adaptation, and mitigation will undoubtedly continue to rise,” the analysis warned, posing the critical question: ‘Who will pay?’
Despite the surge in support for the Climate Superfund Act following the L.A. fires, vigorous opposition from the fossil fuel industry and other interest groups persists, with concerns it would jeopardize jobs and inflate oil prices in California.
Among those actively opposing the bill are the Western States Petroleum Association and the California Chamber of Commerce, which spent significant amounts on lobbying efforts during the quarter.
Both groups issued a joint letter expressing apprehension that the bill would impose retroactive liability on companies for lawful actions dating back to 1990, thereby introducing instability to California’s economic landscape.
Additionally, the groups argue the bill’s financial obligations could exacerbate the ongoing affordability crisis for taxpayers, leading to increased costs for consumers and businesses alike.
A representative of the Western States Petroleum Association highlighted a report from the California Center for Jobs & the Economy, positing the legislation would function as a “de facto carbon tax,” resulting in household expenses soaring by up to $3,400 annually and a significant increase in gasoline prices.
In stark contrast, Clair Brown, an economics professor at UC Berkeley, claims the bill should not lead to inflated gas prices due to the global market’s influence on pump prices.
She supports the idea that this legislation would reasonably internalize costs associated with fossil fuel energy and help facilitate a more equitable transition away from such energy sources.
Concerns raised regarding potential job losses also overlook that fossil fuel employment is affected by factors beyond state demand, including increasing export activities.
Critics argue that oil companies already contribute to California’s climate policies through existing mechanisms like cap-and-trade and low carbon fuel standard credits; however, Brown counters that these two policies do not overlap, each addressing distinct issues.
The proposed Climate Superfund Act targets only about 130 global entities responsible for over a billion metric tons of CO2-equivalent greenhouse gases from 1990 to the present, with only 26 operating within the United States.
A thorough study, mandated by the legislation, would finally clarify which companies are liable in California, determining the extent of their financial obligation.
For instance, Chevron holds a record for approximately 16.6 billion metric tons of historic global greenhouse gas emissions, while Marathon contributes about 2 billion.
The financial outcome of the Climate Superfund is unclear, though New York has priced its Superfund bill at an estimated $75 billion over 25 years.
Some analysts assert this figure represents a fraction of actual anticipated climate adaptation costs, which may exceed $500 billion.
Given the substantial oil activities in California, the potential payout could be more significant than New York’s, but the oil sector’s robust presence in the state explains their determined lobby against such measures.
According to the American Petroleum Institute, oil and gas comprised roughly 6% of California’s gross domestic product last year.
Governor Gavin Newsom has yet to publicly address the bill, with his office indicating that he generally refrains from commenting on pending legislation, though he will assess the proposals based on their merits if they reach his desk.
Meanwhile, California Attorney General Rob Bonta has initiated a climate liability lawsuit against major oil firms, proposing to establish a fund for climate mitigation, akin to the Superfund concept.
Addis reflected that advancing the legislation in California has proven to be an uphill battle, noting the oil industry’s extensive resources and lobbying efforts to undermine environmental legislation.
She emphasized the political challenge posed by President Donald Trump, who has received considerable financial support from the fossil fuel sector and advocated for increased oil and gas production.
The Trump administration’s recent legal actions against New York and Vermont’s climate initiatives suggest a strong commitment to prioritize fossil fuel interests over climate action.
Despite these obstacles, advocates like Coulter maintain that the Climate Superfund Act retains substantial support, given its urgent necessity in addressing California’s climate crisis, paired with dwindling federal funding and a significant state budget deficit.
Coulter pointed out that California already utilizes a similar model established in the 1990s for producing fees against entities responsible for lead contamination, which aids in addressing the lead poisoning crisis among children.
Local governments continue to voice support for the Climate Superfund Act, with recent resolutions from some, including the Los Angeles City Council, endorsing the idea of transferring the burden of climate change recovery costs from taxpayers to the businesses benefiting from the fossil fuel industry.
Although both bills will not advance this year, they remain on the table for reconsideration in the legislative session of 2026.
Addis expressed optimism that California can eventually realize this ambitious plan, highlighting the real-life impacts of climate change that communities have faced due to extreme weather events.
image source from:latimes