A coalition of business and trade groups is suing the Hochul administration over a law that will force oil, natural gas and coal companies to pay $75 million for spewing carbon emissions.
Gov. Kathy Hochul’s administration claimed the law was necessary to combat the companies contributing to climate change for decades — but critics said the extra costs will be passed along to consumers through prices at the pump and heating bills.
“This law is not only illegal and misguided, but it will likely increase the cost of energy, placing an unnecessary burden on New Yorkers and consumers nationwide — especially during a time of already high prices,” Marty Durbin, president of the US Chamber of Commerce’s Global Energy Institute and plaintiff in the case, told The Post.
The lawsuit filed in Manhattan federal court claims Hochul and the state legislature exceeded their authority by approving the New York Climate Change Superfund Act last year, and asked that it be tossed out as unconstitutional.
The plaintiffs also include the New York State Business Council, the American Petroleum Institute and the National Mining Association.
“We’ve always argued that this is bad policy for New York, and we intend to seek reversal through all available avenues,” said Ken Pokalsky, vice president of the NYS Business Council.
The law aims to essentially charge fossil fuel companies for their purported shares of “global, lawful greenhouse gas emissions based on completely unsubstantiated ‘attribution science,’” the plaintiffs claim.
Federal law prohibits New York from imposing liability on fossil fuel energy producers for harms allegedly caused in the Empire State by greenhouse gases emitted outside the state, the lawsuit said.
The plaintiffs said there’s no way that an estimated 38 energy firms could pay back those costs without raising prices to customers, and some critics wondered whether it could even be collected from foreign-owned companies.
“New York seeks to reach back decades in time and impose significant monetary penalties on those producers (operating almost completely outside the State), potentially subjecting other States and consumers to increased energy costs, while reaping the financial benefits to pay for ‘climate change adaptive infrastructure,’” the suit claimed.
It’s the second lawsuit filed against the law. Twenty two states, led by West Virginia, also filed a challenge last month.
An analysis conducted for the bill’s sponsors state Sen. Liz Krueger (D-Manhattan) and Assemblyman Jeffrey Dinowitz (D-Bronx) last year showed foreign-owned and American companies together would pay about $3 billion a year over 25 years.
The oil giant Saudi Aramco of Saudi Arabia could be slapped with the largest annual assessment of any company — $640 million a year — for emitting 31,269 million tons of greenhouse gases from 2000 to 2020.
Aramco — formally known as the Saudi Arabian Oil Co. — is owned by the Saudi Royal family.
The state-owned Mexican oil firm Petróleos Mexicanos, or Pemex, emitted 9,512 tons of CO2 and could face an $193 million assessment for generating 9,512 million tons of greenhouse gases.
Russia’s Lukoil could be assessed with a $100 million yearly fee for spewing 4,912 millions of CO2.
The 38 companies identified as carbon polluters include American petro giants Exxon and Chevron as well as Shell and BP in the UK, Total Energies IES in France, Petrobras in Brazil, BHP in Australia, Glencore in Switzerland, Equinor in Norway and ENI in Italy.
Hochul defended the law, which would begin collecting funds in 2028 and be used to upgrade infrastructure impacted by extreme weather or install more energy efficient cooling and heating systems in buildings.
“Governor Hochul proudly signed the Climate Superfund Act because she believes corporate polluters should pay for the damage done to our environment—not everyday New Yorkers,” said spokesman Paul DeMichele.
“We look forward to defending this landmark legislation in court and defeating Big Oil once again.”
A series of green energy laws going into effect that seek to ween New York’s off fossil fuels and transition toward emissions free alternatives is causing a backlash over concerns that the green push will trigger higher energy costs.
A Hochul administration green rule requiring that 35% of 2026 model cars sold in the state to be “emissions free” is an unrealistic bust, auto dealers claim.
The Climate Leadership and Community Protection Act of 2019 requires the state and its energy producers and consumers to move away from fossil fuels by slashing gas emissions by 40% by 2030 with the goal of achieving 100% zero-carbon-emission electricity by 2040.
Gov. Kathy Hochul and the Democratic-led legislature have also banned gas stoves, furnaces and propane heating in new buildings. In December, Hochul extended the state’s fracking ban by prohibiting a new technique to use carbon dioxide to extract natural gas.
The gripes come amid outrage over Con Edison’s request to jack up electric bills by 11.4% and send gas bills soaring 13.3% for its 3.6 million customers.
Hochul has said she opposed the hikes even though the utility giant partially blamed the need for higher rates on the high cost of building clean energy infrastructure to comply with the state climate law.
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