Climate Change Superfund Act

Why are NY Taxpayers Subsidizing Big Oil & Gas in this Day & Age?

/ Peter Bardaglio / Leave a comment

New York State currently subsidizes the fossil fuel industry by exempting it from paying $1.6 billion of Sales & Use Taxes and Petroleum Business Taxes every year. When I first learned of these subsidies, I was astonished. How could New York, which established some of the most aggressive targets in the nation for reducing greenhouse emissions in its climate law of 2019, still be handing out taxpayer dollars to businesses that continue to pump more of these emissions into the atmosphere?

Besides this obvious reason for taking a good, hard look at the subsidies, there are at least two more reasons why they no longer make any sense. First, the fossil fuel industry has been making enormous profits in recent years. In 2023, the global oil and gas industry earned a record income of more than $2.7 trillion, while they invested just 4% of capital expenditure on clean energy. Clearly, big oil and gas no longer need to be supported by these tax breaks, especially when they are turning around and investing so little in clean energy.

Second, New York passed the Climate Change Superfund Act last year in an effort to hold the fossil fuel industry accountable for the damage that its reckless business practices inflicted on the state. In other words, we are handing out subsidies to the same industry that we have just decided to impose stiff penalties on for its destructive behavior.

The Stop Climate Polluter Handouts Act (S3389/A7949), currently being considered by the state legislature, seeks to pull back on the incentives that benefit the most highly polluting fuels and their most unreasonable uses, including high-emission commercial airline fuel and low-grade shipping “bunker” fuel, the operation of fracked gas infrastructure, industry research and development, and more.

The bill targets fossil fuel corporations’ most egregious actions and protects ordinary New Yorkers by preserving some tax breaks that benefit the public such as the home heating credit for low and middle-income households and an agricultural exemption that helps small- to mid-sized farmers. In total, the legislation would end over $330 million in fossil fuel subsidies. At a time when Washington is taking steps to make huge cuts in the federal budget, cuts that would be extremely damaging to New York, the bill would also help to close the state’s budget deficit.

In short, the Stop Climate Polluter Handouts Act is a commonsense bill, raising revenue for the state while aligning state spending with New York’s 2018 climate law targets and holding fossil fuel companies accountable to pay the taxes from which they have been exempted for decades. There are only a few days left in this year’s legislative session, so time is running out. The legislature needs to move quickly to approve this measure and send it on to Gov. Hochul for her signature.

Two Steps Forward, One Step Back

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With the Trump administration taking office on January 20, it’s become clear that efforts to stave off runaway climate change will have to focus on state and local policy.

Trump has promised to halt federal support for clean energy technology and electric vehicles, and he has pledged to withdraw the U.S. from the Paris climate accord, reverse a key regulation aimed at reducing emissions from power plants, and roll back other rules aimed at curbing climate change and air and water pollution.

Offshore wind is a crucial component of New York’s attempt to achieve 70 percent of its electricity from renewable energy by 2030. Photo by David Dixon/Walney Offshore Windfarm licensed under CC BY-SA 2.0.

Clean Energy’s Rapid Growth Continues

One bright light, though, is the fact that Trump can slow down progress, but he can’t stop the transformation of the domestic and global economies sparked by the clean energy revolution.

More than 40 percent of all global power in 2023 came from renewable sources, and investments in renewable energy are accelerating because prices have dropped dramatically. In fact, more than 80 percent of new electricity capacity around the world comes from carbon-free sources.

NY’s Leadership Role

Nonetheless, action at the state and local levels will be imperative going forward. With Gov. Kathy Hochul’s signing of the Climate Change Superfund Act, New York has taken on a leadership role that will give the state an opportunity to defy the president-elect’s attempt to reverse climate action. This new law, as explained above, will require the biggest oil and gas companies to contribute to a fund that will be used for infrastructure projects meant to protect New York residents from increasingly dangerous climate disasters like storms and sea level rise.

Another major step in the state’s climate fight took place when Hochul, at the same time, signed into law a prohibition on using carbon dioxide for fracking, closing a loophole in New York’s existing hydraulic fracturing ban (also reported above). This legislation, introduced by Assemblymember Anna Kelles in March, signals a determination to keep the fracking industry out of the state.

These two steps forward should be applauded, while at the same time recognizing the importance of continuing the push on climate action and clean energy in Albany when the state legislature opens its new session on January 8. Efforts to ensure that New York obtains 70 percent of its electricity from renewable energy by 2030, as called for by the 2019 Climate Leadership and Community Protection Act (CLCPA) are especially critical.

Expanding offshore wind, implementing congestion pricing in New York City, eliminating subsidies for new gas hookups as well as the Public Service Commission’s obligation to provide gas service, reducing state tax breaks provided to the fossil fuel industry, putting in place a true cap-and-invest program with guardrails to keep it from devolving into cap-and-trade, increasing the kinds of containers covered by the state’s bottle law, and addressing the issue of plastic packaging are just some of the ways New York can continue to strengthen its leadership role on the climate and clean energy fronts.

At the local level, we’ve seen a disappointing step backward with the continued attempt by Cornell University to install synthetic turf fields on campus. Given the recent finding that 2024 is set to become the hottest year on record, the massive rollout of plastic undertaken by Cornell at its athletic facilities is a bad look, to say the least.

Equally dismaying is the apparently superficial investigation by the city planning board as part of the approval process. The board’s negative declaration of environmental significance, precluding the need for the kind of thorough environmental impact statement (EIS) called for by Zero Waste Ithaca, is hard to fathom in light of existing scientific research outlining the harmful public health and environmental effects of synthetic turf. We can only hope that the lawsuit launched by this activist organization will result in greater transparency regarding the risks involved.

Time for New Leadership on Climate and Energy

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With the coming change in administration in Washington, it’s safe to say we’ll be seeing some dramatic shifts in climate and energy policy, none of which is likely to result in lower greenhouse gas emissions. Consequently, it is critical that local communities and states step in to lead the way on climate resiliency and adaptation, as well as the clean energy transition. Given the huge transformation of the political landscape at the national level, New York must move forward decisively. The biggest indication that it will do so would be if Governor Hochul signs the Climate Change Superfund Act passed at the end of the last session. This act adopts the “polluter must pay” principle. The fossil fuel industry has known for decades that its product is responsible for the climate damage we’ve experienced, and through its campaign of misinformation and outright deception it has avoided accountability. It is time for this to stop. The bill doesn’t ask Big Oil to pick up the entire tab, just a fair share of it. Taxpayers should not have to cover the entire cost of destruction caused by the fossil fuel industry. Besides the Climate Change Superfund Act, unfinished business from the last session includes the NY HEAT Act, which seeks to eliminate subsidies for new gas hookups, eliminate the “obligation to serve” gas to neighborhoods, and ensure that no low-income household would pay more than 6% of its income for energy. The NY HEAT Act passed in the Senate this year by a wide margin, but never came to a vote in the Assembly due to the controversy over congestion pricing that erupted in the final days of the session. Another big piece that needs to be put in place is the Cap and Invest Program. By applying a price to the amount of pollution, the Cap and Invest Program incentivizes consumers, businesses, and other entities to transition to lower-carbon alternatives. Assemblymember Anna Kelles (D -125th District) is the lead sponsor on a version of this program that would put in place guardrails to keep it from devolving into a vehicle for cap and trade, and would also ensure that an appropriate share of the revenue raised by the program goes to projects in frontline communities. As Kelles points out, the Climate Change Superfund Act and the Cap and Invest Program work together, with the former addressing past damage and the latter looking forward to future destruction incurred as a result of carbon pollution. Together with the NY HEAT Act, adoption of this legislation would send a strong message to Washington and the other states that progress on the climate and clean energy transition cannot be stopped.

The Days of Reckoning Are Just Ahead

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There’s no need at this stage to press the point that the coming U.S. election will be pivotal, not just in terms of whether our constitutional republic will survive, but also whether we can manage to avoid catastrophic, runaway climate change. Regular readers of this column readily grasp what’s at stake with both of these issues.

A report just released by World Weather Attribution (WWA), an international research group, closely examines how the 10 deadliest weather disasters since 2004, including three tropical cyclones, four heatwaves, two floods and a drought, killed an estimated half million people, and probably many more. It makes for sobering reading and, on the eve of Tuesday’s election, is a reminder that our choices at the ballot box will affect not just this nation but the entire planet.

Flooding in Valencia, Spain. Photo by Eidursson – Own Work licensed under CC BY 4.0.

Role of Fossil Fuels
The WWA study investigates how all of these events were intensified by global warming, which was, in turn, caused by the burning of fossil fuels and deforestation. The main finding is simply put: “with every ton of coal, oil and gas burned, all heatwaves get hotter, and the overwhelming majority of heavy rainfall events, droughts, and tropical cyclones get more intense.” In other words, there is no such thing as a “natural” disaster anymore.

Polluters Must Pay
As if to underscore the truth of this observation, horrific flooding in Spain that claimed at least 158 deaths took place just as the WWA analysis was issued. According to Spain’s national weather service, it rained more in eight hours in Valencia, the hardest hit region, than it had in the preceding 20 months. Imperial College climate scientist Friederike Otto, who helps run the WWA, said it was “very clear that climate change did play a role.”

The flooding in Europe and across the U.S. Southeast this fall also underscores why the effort to hold the fossil fuel industry responsible for the havoc that it has caused is so critical, especially in light of the overwhelming evidence that Big Oil was aware of the potential consequences.

At the federal level, Sen. Chris Van Hollen (D-MD), Rep. Jerry Nadler (D-NY), and Rep. Judy Chu (D-CA) have recently introduced bills in Congress to do so. The Polluters Pay Climate Fund Act would assess companies based on their global carbon dioxide emissions, and it authorizes the U.S. Treasury Department to charge the largest polluters in proportion to their past carbon emissions, in excess of 1 billion metric tons, an estimated $100 billion each for ten years.

Closer to home, the New York Climate Change Superfund Act, still sits on Gov. Kathy Hochul’s desk, awaiting her signature to become state law. Both the General Assembly and State Senate passed the legislation during the last session. Public pressure has mounted on the governor to act, and it’s a certainty that this pressure will increase exponentially after the election.

Under the bill passed by lawmakers, New York would seek to collect about $3 billion a year for the next 25 years, for a total of $75 billion. The state Department of Environmental Conservation would be tasked with identifying the oil and gas companies that should be held responsible for greenhouse gas emissions and it would investigate how much they should each pay the state.

Regardless of the outcome of these events, one thing is for sure: the days of reckoning are upon us, and we each have the obligation as democratic citizens to make our voices heard. If there ever was a time to make sure that we become subjects in history and are not just objects of history, it is now.

How Serious is NY about Its Climate Goals?

/ Peter Bardaglio / Leave a comment

There’s something seriously unnerving about the casual way in which Gov. Hochul has acknowledged that New York will probably not meet its 2030 climate targets. The pathbreaking Climate Leadership and Community Protection Act (CLCPA) calls for the state to obtain 70 percent of its electricity from renewable energy by 2030.

A joint draft report issued in July by the New York State Energy Research and Development Authority (NYSERDA) and the Public Service Commission (PSC) indicated that the 70 percent renewables target will not be achieved before 2033.

State State Comptroller Thomas DiNapoli and Senate Majority Leader Andrea Stewart-Cousins. NY Senate Photo licensed under CC BY 2.0.

Audit Reveals Flaws
A few weeks after this report, State Comptroller Thomas DiNapoli released a detailed audit criticizing the PSC and NYSERDA for inadequate planning and the use of outdated data. In particular, it said that the PSC had failed to address “all current and emerging issues that could significantly increase electricity demand and lower projected generation.”

Perhaps most disturbing was the audit’s finding that the PSC had overlooked the need to calculate the costs of the transition to renewables or to identify how to cover those costs beyond the tried and true method of dumping them on ratepayers. 

How Committed is the State?
Together these two reports raise major questions about the actual commitment of the state to implementing the 2019 CLCPA. The governor’s reaction to these findings? Oh well, it won’t hurt if we let things slide for a few years. Not surprisingly, state Republican leaders and the business community have taken advantage of the leadership vacuum to attack the climate law and press Hochul to abandon it.

How is it possible for this failure of leadership to take hold during the same summer that global temperatures have been setting new records month after month? In fact, not only was this past July the warmest on record, but it was also the 14th consecutive month of record-high global temperatures. Does anyone see a pattern here?

Cornell professor Robert Howarth, a member of the state’s Climate Action Council, certainly does. The council passed a plan to implement the CLCPA in December 2022, and Howarth is on the front line defending it. “I am appalled at this pushback against the CLCPA by business interests pushing their short-sighted agenda,” Howarth said in an interview with WaterFront. “Climate change is very real. The consequences of climate disruption (floods, droughts, fires, crop failures) are becoming increasing obvious to all.”

Eddie Bautista, executive director of the New York City Environmental Justice Alliance, strongly agrees that stronger leadership is necessary. “In just five short years, we’ve gone from being visionary leaders to not being able to implement our own laws. It’s just insane,” he said recently.

The governor’s reversal on congestion pricing in New York City has environmentalists wondering whether this is part of a larger plan to back away from other elements of the state climate action agenda such as the cap-and-invest plan that would price greenhouse gas emissions. At the very least, it looks likely that the administration will blow past its self-imposed deadline to launch the program in early 2025.

A Simple Step
One step that Hochul could take to restore some degree of confidence in her commitment to climate action would be to sign the Climate Change Superfund Act that is currently sitting on her desk after being passed in June by both the General Assembly and State Senate. This legislation would require oil and gas companies to pay a total of $3 billion a year for 25 years to cover the cost of the climate damage they have inflicted on the state.

The governor has not yet signaled her intention, which leaves a lot of climate activists worried, although some think she might just be waiting until after the election to do so. The pressure on her has been growing throughout the summer and will only continue to increase this fall.

Fossil Free Media, together with the Sunrise Movement, has launched a national billboard campaign in California, New York, Arizona, and Philadelphia, with plans to expand to Florida and Louisiana in September. as part of the effort to build support for the principle that polluters should pay for the mess they have made.

The Make Polluters Pay campaign seeks to hold the fossil fuel industry accountable through legislation, lawsuits, and public pressure. This is exactly the kind of national attention that Hochul wants to avoid, but she better get used to it. Sen. Chris Van Hollen (D-MD) and Rep. Jerry Nadler (D-NY) just announced their intention to introduce federal Polluter Pays bills in Congress. Things are definitely heating up – stay tuned.

NYS Drops the Ball on Climate Legislation

/ Peter Bardaglio / Leave a comment

In a breathtaking display of political malpractice, the NYS General Assembly just adjourned the 2023-2024 legislative session in Albany without taking a vote on several crucial pieces of climate legislation.

The final days of the session turned into a brawl to rescue congestion pricing after Gov. Kathy Hochul paused the program just weeks before it was set to begin. As a result, key bills were left by the wayside.

Governor Kathy Hochul. Photo credit: Darren McGee, Office of Governor.

They included the NY HEAT Act, which would stop utilities from automatically charging ratepayers for new gas lines, a measure to reduce plastic packaging, and an expanded bottle deposit law. Both the NY HEAT Act and the Packaging Reduction Act had already passed in the Senate by wide margins, and they had the backing of a majority of co-sponsors in the Assembly, but they never came to a vote.

“This is taking us backwards where we need to be to meet our climate law mandates and to protect people and save them money,” said Liz Moran, a state policy advocate at Earthjustice.

Moran pointed out that NYS lawmakers approved the Climate Leadership and Community Protection Act in 2019, with a goal to reduce greenhouse gas emissions by 85% by 2050. But since then, she said, Democratic leaders in Albany have been unwilling to take the steps needed to actually achieve that goal.

“We will not forget this failure as we struggle with utility shutoffs, high temperatures, and bad air this summer,” said AGREE executive director Jessica Azulay, joining the call for a special session to take up the NY HEAT Act.

The governor’s decision to pause congestion pricing, combined with the failure of the other bills to get a proper hearing in the Assembly, is disconcerting, to say the least. These actions displayed the power of the fossil fuel industry to get its way in Albany, thanks to the flood of dollars it’s handing out in what is an election year.

There was one place where Big Oil failed to get its way, though. In the final hours of the Assembly session—at 3:22 am, to be exact—the Climate Change Superfund Act secured passage.

The bill would charge fossil-fuel companies a total of $3 billion a year for 25 years to pay for costs associated with the destruction caused by climate change.

The Climate Change Superfund Act now lands on Gov. Hochul’s desk, awaiting her signature. If enacted, New York will join Vermont as the second U.S. state with a law requiring fossil-fuel companies to pick up at least a portion of the tab for the huge damage they’ve knowingly inflicted.

There will be tremendous pressure brought to bear, as there should be, by climate justice and environmental groups across the state to make sure the governor signs this historic bill. If she does, it will mark a significant step towards holding climate polluters accountable.

A Failure of Leadership at the Capitol

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When the state’s final budget was released earlier this month, not a single major climate bill was included. No Climate Change Superfund Act, no NY HEAT Act, no Stop Climate Polluter Handouts Act.

It was a shocking development in light of the state’s supposed commitment to achieving an 85% reduction in greenhouse gas emissions by 2050. That’s what New York State’s 2019 Climate Leadership and Community Protection Act (CLCPA) requires, but you’d never know it flipping though the pages of this year’s budget book.

The New York State Capitol in Albany. Photo by Craig Fildes licensed under CC BY-NC-ND 2.0 DEED.

The operative word in the title of the CLCPA is “leadership.” It was hard to discern any of that, however, when it came to Gov. Hochul and the legislature, especially the General Assembly. Instead, anxiety about the upcoming elections prevailed and Democrats took the safe way out. It was a sad day in Albany and there was little to celebrate when Earth Day occurred a few days later.

The Fossil Fuel Industry Betrayal

It was bad enough when we found out this past January that the fossil fuel industry had more than enough evidence as early as 1954 to understand the impact of greenhouse gas emissions on the climate. But then word came today, with the release of internal documents, that Big Oil lobbied against climate policies that they claimed to support. The betrayal was complete.

“For decades, the fossil-fuel industry has known about the economic and climate harms of its products,” declared Sen. Sheldon Whitehouse (D-RI) “but [it] has deceived the American public to keep collecting more than $600bn each year in subsidies while raking in record-breaking profits.”

Where Do We Go From Here?

In the context of these larger national events, the fact that oil and gas companies were a major factor in pressuring state legislators to forego climate legislation in this year’s budget is especially galling. All three major bills directly confront the oil and gas firms. The NY HEAT Act seeks to eliminate subsidies for new gas hookups, eliminate the “obligation to serve” gas to neighborhoods, and ensure that no low-income household would pay more than 6% of its income for energy.

The Climate Change Superfund Act holds major oil companies accountable for the harm they inflicted on New York between 2000 and 2018. It would require these companies to bear a share of the costs of infrastructure investments required to adapt to the impacts of climate change in the state. The program would assess the major fossil fuel emitters $3 billion annually over the span of 25 years to offset the climate damages incurred by the state.

The Stop Climate Polluter Handouts Act aims at paring back the $1.6 billion taxpayers hand out each year to the oil and gas companies in tax subsidies and other breaks. It defies logic that the state continues to provide huge subsidies to an industry that is causing so much destruction. This bill would end the most egregious state subsidies, amounting to $265 million annually.

The fight to secure the passage of these three bills is far from over. Even though the budget has been set, the legislature still has until June 1 to gain their approval. This is clearly the tougher road but climate movement activists across the state, including TCCPI, are gearing up to push even harder over the next four weeks for this legislation to become law. It’s time to roll up our sleeves and get to work!