Vt. First State to Charge Oil Companies For Climate Damage

(HENRY NICHOLLS/Getty Images)

Vermont on Friday became the first state to enact legislation that requires oil companies to pay for damages resulting from alleged climate change after Republican Gov. Phil Scott allowed the bill to become law without his signature.

Scott, a popular governor who is seeking reelection in November to a fifth two-year term, decided against vetoing the bill because the General Assembly has a veto-proof majority in both chambers. He voiced his concerns about the bill in a letter Thursday to John Bloomer, a Republican who has been secretary of the state Senate since 2011.

“Taking on ‘Big Oil’ should not be taken lightly,” Scott wrote. “And with just $600,000 appropriated by the Legislature to complete an analysis that will need to withstand intense legal scrutiny from a well-funded defense, we are not positioning ourselves for success.

“I’m deeply concerned about both short- and long-term costs and outcomes. Just look at our unsuccessful nationally focused cases on GMOs [genetically modified organisms], campaign finance and pharmaceutical marketing practices. I’m also fearful that if we fail in this legal challenge, it will set precedent and hamper other states’ ability to recover damages.”

Last July, storms dumped up to two months’ worth of rain in a couple of days in parts of Vermont, surpassing the amount that fell when Tropical Storm Irene blew through in 2011 and caused major flooding. Officials called the flooding the state’s worst natural disaster since floods in 1927, and some reportedly suggested such storms were the result of climate change.

Under the legislation, the state treasurer, in consultation with the Agency of Natural Resources, would provide a report by Jan. 15, 2026, on the total cost to residents and the state from greenhouse gas emissions from Jan. 1, 1995, to Dec. 31, 2024. The assessment would look at the effects on public health, natural resources, biodiversity, agriculture, economic development, flood preparedness and safety, housing, and any other effects the state treasurer and Climate Action Office determines is relevant.

The new law is modeled after the federal superfund program and empowers Democrat Attorney General Charity Clark to pursue payments from oil companies for a share of what climate change has cost the state since 1995, based on how much their products contributed to the problem globally. Vermont would use those funds to create a new program to finance recovery from climate change-fueled disasters and adapt to the “changed” climate.

California, New York, Massachusetts, and Maryland reportedly are considering similar legislation.

Democrat state Rep. Martin Lalonde, chair of the House Judiciary Committee and a lawyer, said he believes lawmakers have written a policy that will stand up to legal scrutiny.

“I believe we have a solid legal case,” Lalonde said, according to Vermont Public. “Most importantly, the stakes are too high – and the costs too steep for Vermonters – to release corporations that caused the mess from their obligation to help clean it up.”

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