Vermont recently became the first state in the nation to mandate oil and gas companies pay into a climate recovery fund. It’s modeled after an Environmental Protection Agency (EPA) program.

Governor Phil Scott, a Republican, didn’t veto the Climate Superfund Act and allowed it to pass without his signature. Once enacted, it’ll require oil and gas companies to pay for damages they’ve allegedly wrought on the environment as far back as 70 years. The total cost owed by companies will be determined by January 2026.

The initial details regarding how costs for this climate superfund will be determined, and how much individual companies will pay are murky. 

Daily Caller reporter Nick Pope explains, “The amounts that companies owe would be calculated based on an assessment of how much climate change contributed to extreme weather in Vermont, and how much damage those events cost, according to NBC News. Then, each companies’ proportion of the total obligation would be decided by how many tons of carbon dioxide they each emitted between 1995 and 2024.”

This seems like overreach by the Vermont government to accord with Environmental, Social, and Governance (ESG) movement goals to achieve net-zero emissions, in totality, by 2050.

Blue states like California, Maryland, Massachusetts, and New York are mulling similar legislation to Vermont.

Nevertheless, Vermont will be challenged for passing this extreme law. 

Notably, the American Petroleum Institute (API) called the law unconstitutional because it “retroactively imposes costs and liability on prior activities that were legal” and “violates equal protection and due process rights” of lawful oil and gas companies. 

Oil and gas companies also appear to be changing their tune on ESG and net-zero directives because they’re not profitable and detract from their mission statement.

Last week, Exxon Mobil shareholders staved off a challenge by climate activists after 12 director nominees secured re-election with 87 to 95% support. Shell also announced it is shedding offshore wind jobs (after a bad year for the industry) and will instead pivot back to oil and gas to focus on “value over volume.”

As I recently noted here at IWF, pursuing net-zero emissions is unsustainable and comes with a hefty economic price: 

BloombergNEF’s New Energy Outlook says global decarbonization will cost $215 trillion between now and 2050—a 19% increase from current estimates—to meet the Paris Climate Accord’s goal of not warming 1.5 degrees Celsius above pre-industrial levels. Another recent study found costs to phase out fossil fuels would average $19 trillion to $59 trillion annually.

Americans—especially outside of Vermont—are rejecting climate alarmism and calls to decarbonize our economy because it’s resulting in higher energy, gas, and utility bill prices. 

According to the Vermont Department of Environmental Conservation, there are no active oil or gas wells in the state. The Energy Information Administration (EIA) reports Vermont consumed more energy than it produced—3.4 times over. It also reported 57% of residents heat their homes using petroleum products.

Unsurprisingly, regular Vermonters will directly feel the effects of this new Climate Superfund Law.