A federal judge has struck down a New York law that would have required major fossil fuel producers to collectively pay $75 billion toward infrastructure repairs and projects intended to reduce future damage from climate change.
U.S. District Judge Brenda Sannes ruled that the state program intruded into an area governed by federal law and conflicted with the need for a uniform national approach to energy and environmental policy. The law, signed by Gov. Kathy Hochul in 2024, called for companies associated with substantial greenhouse gas emissions to pay $3 billion annually for 25 years.
The money was intended to help cover costs tied to extreme weather and climate resilience. Planned uses included coastal wetland restoration and improvements to roads, bridges and drainage systems. Companies identified as major greenhouse gas emitters between 2000 and 2018 would have been subject to the assessments.
Sannes found that the law sought damages tied to the cumulative effects of conduct occurring across the globe, extending beyond New York’s authority. She also concluded that the Clean Air Act places regulation of greenhouse gas emissions primarily under the Environmental Protection Agency. Efforts to collect payments from foreign fossil fuel producers were separately preempted under the federal government’s foreign affairs authority, according to the ruling.
The law faced challenges from fossil fuel interests, business organizations including the U.S. Chamber of Commerce, 22 Republican state attorneys general and the EPA. The Justice Department said the ruling aligned with President Donald Trump’s directive to challenge state energy policies that the administration considers an unlawful exercise of state authority.
Hochul’s administration has not said whether it will appeal. A spokesperson said taxpayers should not bear the costs of damage caused by polluters and that state officials were reviewing the decision. Climate activists have called for an appeal.
For property and catastrophe claims professionals, the dispute centers on a familiar cost problem at a much larger scale: how communities finance repairs and mitigation after damaging weather events. New York intended to direct the fossil fuel payments toward infrastructure that can affect the severity of future property losses, including drainage systems, transportation infrastructure and coastal protections. The ruling blocks that funding mechanism unless it is revived on appeal.
The decision also adds to litigation over state efforts to assign climate-related costs to energy producers. The Trump administration has challenged climate measures in Michigan, Hawaii and Vermont, setting up broader disputes over the boundary between state authority and federal control of environmental and energy policy.
