The U.S. Justice Department recently sued two states over their “climate superfund laws” – a move NJBIA says should give New Jersey pause before enacting its own law assessing penalties on fossil fuel companies for legal operations that allegedly caused damages attributed to climate change.
New Jersey bills A-4696/S-3545 have been approved by legislative committees in the past five months but have not been scheduled for a vote by the full Assembly or Senate. NJBIA Deputy Chief Government Affairs Officer Ray Cantor said Tuesday the federal efforts to have similar laws in New York and Vermont declared unconstitutional underscores the fact that New Jersey too would face costly legal challenges should it follow the same misguided path.
“NJBIA has said all along that laws that try to retroactively punish companies for providing legal, necessary fossil fuel products are unconstitutional,” Cantor said. “Such laws will lead to higher energy costs that will ultimately impact consumers at the pump and on their utility bills. The Justice Department’s action should be a warning to proponents of this bill in New Jersey.”
Acting Assistant U.S. Attorney Adam Gustafson of the Justice Department’s Environment and Natural Resources Division filed complaints May 1 in the federal courts in New York and Vermont seeking to stop those states from enforcing their climate superfund laws. In separate actions, Gustafson also filed complaints against Michigan and Hawaii, which have stated their intention to sue fossil fuel companies in state courts for alleged climate change harm.
“When states seek to regulate energy beyond their constitutional or statutory authority, they harm the country’s ability to produce energy and they aid our adversaries,” Gustafson wrote. “The Department’s filings seek to protect Americans from unlawful state overreach that would threaten energy independence critical to the wellbeing and security of all Americans.”
President Donald Trump recently directed U.S. Attorney General Pamela Bondi to take action to stop the enforcement of state laws that unreasonably burden domestic energy development so that energy is reliable and affordable for all Americans. These recent lawsuits advance the directive in Executive Order 14260, Protecting American Energy from State Overreach.
“These burdensome and ideologically motivated laws and lawsuits threaten American energy independence and our country’s economic and national security,” Bondi said in a statement issued last week.
The complaints filed in U.S. District Courts for the Southern District of New York and for the District of Vermont challenge laws passed by those states that would impose strict liability on energy companies for their worldwide activities extracting or refining fossil fuels. The laws assess penalties for those businesses’ purported contributions to harm that those states allegedly are experiencing from climate change. The New York law seeks $75 billion from energy companies, while the Vermont law seeks an unspecified amount.
The federal government’s complaints allege that the New York Climate Change Superfund Act and the Vermont Climate Superfund Act are preempted by the federal Clean Air Act and by the federal foreign affairs power, and that they violate the U.S. Constitution. The Justice Department is seeking a court declaration that these state laws are unconstitutional and an injunction against their enforcement.
The federal complaints against the four states can be viewed on the links below:
