Vermont’s climate superfund law sparks legal battle over energy freedom and accountability

• The U.S. Chamber of Commerce and the American Petroleum Institute (API) filed a federal lawsuit on January 3, 2025, challenging Vermont’s Climate Superfund Act, which holds fossil fuel companies financially accountable for climate change damages dating back to 1995. The plaintiffs argue the law is unconstitutional, overreaches state authority, and threatens interstate commerce and energy freedom.
• Enacted in 2024, the law is the first of its kind in the U.S., requiring fossil fuel companies responsible for over one billion metric tons of emissions to pay for climate-related damages. Funds will support infrastructure improvements, such as stormwater systems and building weatherization, based on a state assessment of climate impacts from 1995 to 2024.
• The lawsuit claims Vermont’s law imposes retroactive penalties on lawful, out-of-state conduct regulated by the federal Clean Air Act and unfairly targets specific companies for emissions from billions of sources. Critics argue it violates the Commerce Clause and could increase costs for consumers nationwide.
• Vermont’s law has inspired similar legislation in states like New York, Massachusetts, California, and Maryland. The lawsuit is seen as a test case for state-level climate accountability efforts, with legal experts predicting a prolonged legal battle that could set a national precedent.
• Environmental advocates argue the lawsuit is an attempt by the fossil fuel industry to evade responsibility for climate damages, while critics question Vermont’s reliance on fossil fuels and its authority to impose penalties. The case highlights tensions between state versus federal authority, energy freedom, and the role of fossil fuel companies in addressing climate change.

In a landmark legal showdown, the U.S. Chamber of Commerce and the American Petroleum Institute (API) have filed a federal lawsuit against Vermont, challenging the state’s unprecedented Climate Superfund Act. The law, enacted in 2024, seeks to hold fossil fuel companies financially accountable for climate change damages dating back to 1995. The lawsuit, filed on January 3, 2025, argues that Vermont’s law is unconstitutional, overreaches state authority, and threatens to disrupt interstate commerce and energy freedom.

Vermont’s Climate Superfund Act, the first of its kind in the nation, was passed in response to catastrophic flooding and extreme weather events that devastated the state in recent years. The law tasks the state treasurer and the Agency of Natural Resources with calculating the financial toll of climate change on Vermont from 1995 to 2024. This assessment, due by January 2026, will evaluate impacts on public health, natural resources, agriculture, and infrastructure. Using federal data, Vermont plans to attribute greenhouse gas emissions to specific fossil fuel companies responsible for over one billion metric tons of emissions during the period.

Funds collected under the law would be allocated to infrastructure improvements, such as stormwater drainage systems, road and bridge upgrades, and weatherization of buildings. The law is modeled after the federal Superfund program, which holds polluters accountable for environmental cleanup costs.

However, the U.S. Chamber of Commerce and API argue that Vermont’s law is an unconstitutional overreach. Tara Morrissey, senior vice president and deputy chief counsel of the Chamber’s litigation center, stated that Vermont is attempting to impose retroactive penalties on lawful, out-of-state conduct regulated by the federal Clean Air Act. She emphasized that climate change is a global issue best addressed by federal legislation, not state-level mandates that could increase costs for consumers nationwide.

The lawsuit also contends that Vermont’s law creates an impossible task of accurately attributing emissions over decades. The plaintiffs argue that greenhouse gases come from billions of individual sources, making it unfair and impractical to assign liability to specific companies. They further claim that the law violates the Commerce Clause by targeting large energy companies located outside Vermont, potentially setting a dangerous precedent for other states.

Environmental advocates, however, see the lawsuit as an attempt by the fossil fuel industry to evade accountability. Anthony Iarrapino, a lobbyist with the Conservation Law Foundation, called the lawsuit a tactic to avoid responsibility for the damages caused by fossil fuel use. He noted that more states are following Vermont’s lead, holding Big Oil ‘accountable’ for disaster recovery and cleanup costs from ‘climate-fueled’ storms.

Either way, a legal precedent will be set

The legal battle has broader implications for climate accountability measures nationwide. Vermont’s initiative has already inspired similar legislation in New York, where Governor Kathy Hochul recently signed a law requiring major greenhouse gas emitters to pay into a state fund for climate-resilient infrastructure projects. Massachusetts, California, and Maryland are also considering similar measures.

Legal scholars predict a protracted fight. Michael Gerrard, director of the Sabin Center for Climate Change Law at Columbia University, described the lawsuit as a “shot across the bow” by the fossil fuel industry, signaling their intent to vigorously oppose such laws. He noted that while the suit may be premature – Vermont has yet to finalize its damage assessments and billing process – it underscores the industry’s determination to challenge state-level climate accountability efforts.

The lawsuit also highlights Vermont’s reliance on fossil fuels, with roughly two-thirds of households depending on them for heat and per capita consumption exceeding that of two-thirds of states. Critics argue that this undermines Vermont’s moral authority to impose penalties on fossil fuel companies. However, environmental advocates counter that the scientific consensus is clear: human activity, particularly the burning of fossil fuels, is the leading cause of climate change, and dismiss the lawsuit as an attempt by the fossil fuel industry to ‘undermine science’ in pursuit of profits.

As Vermont prepares to defend its law in federal court, the outcome could set a significant precedent for climate accountability measures across the country. While Vermont argues that the polluter-pays model is essential to address the financial toll of climate change, the fossil fuel industry contends that such measures could disrupt economic and legal norms. Society would not be what it is today without fossil fuels; even as new technologies come online it’s absurd to take punitive measures against the technology that got us here.

The case represents a pivotal moment in the ongoing debate over energy freedom, state versus federal authority, and the role of fossil fuel companies in addressing climate change. As the legal battle unfolds, its ramifications will reverberate far beyond Vermont’s borders, shaping the future of climate policy in the United States.

Sources include:

YourNews.com

Ripbs.org

APNews.com