Vermont passes bill to make oil companies pay for climate change

The long-standing aspiration of the environmental movement to hold polluting companies responsible for their actions is closer to being fulfilled in Vermont, a state in the northeastern United States, on the border with Canada. Both houses of parliament in Burlington, the state capital, approved a bill this week designed to make Big Oil pay for damages caused by climate change disasters — costs that will run into billions of dollars.

The bill was approved with an overwhelming majority in both the Senate (26 votes in favor, three against) and in Congress (94-38), and now, it will return to the upper house for a second vote, before being sent to the Republican Governor Phil Scott to sign. Once these procedures are completed, the Climate Superfund Act, as it has been named, will become the first of its kind in the United States. Four States — Maryland, Massachusetts, California and New York — are halfway through their respective processes to introduce similar legislation. It is also foreseeable that the bill’s approval will mark the beginning of a fierce battle in the courts, with the lawyers of these large companies looking for any legal loophole to avoid paying.

Vermont was inspired by an Environmental Protection Agency (EPA) in Washington program that forces polluting companies to clean up their toxic waste, or pay the U.S. government to have authorities take care of it.

To account for what is owed, the regulatory text includes tools to calculate the extent to which climate change has contributed to extreme weather events in Vermont, and what those episodes — some as recent as last summer’s floods — cost the state. To do this, consideration will be given to the damage caused in areas such as the economy, public health and biodiversity. Once that amount is determined, it is distributed based on the tons of carbon dioxide that each company affected by the law emitted between 1995 and 2024. For this calculation, the international Carbon Majors database, which indicates the largest private polluters of the planet, will be used.

Mosquitoes and giants

To give an idea of the unequal fight that is coming in the courts, Republican Senator Randy Brock — who voted against the law — argued that “ExxonMobil alone has annual sales of $344.6 billion, and Vermont has an annual budget of about $8.5 billion.” “We’re a mosquito compared to a giant,” he states.

Of the states that could follow Vermont’s example, the New York initiative has progressed the furthest, with the Senate approving the text of a similar bill. In Washington, two Democratic senators, Bernie Sanders — undoubtedly the best-known politician from the depopulated state of Vermont — and Chris Van Hollen (Maryland) tried to introduce a provision to make polluting companies pay for climate change in the Inflation Reduction Act (IRA), signed by President Joe Biden in the summer of 2022. It was one of the major legislative achievements of Biden’s first term, as well as the most important piece of legislation passed in the United States to address the effects of climate change — although it did not go as far as the Vermont bill. If it had survived in the IRA draft, it would have cost Big Oil about $500 billion, according to the initiative, which was called The Polluter Pays Climate Fund Act.

Last July, devastating and unusual rains devastated Vermont, leaving two dead and about $1 billion in damage. Another episode of heavy rainfall came in December 2023. At the time, Governor Scott — who does not support the climate change denialism of other Republicans — said: “Climate change is real. I don’t think anyone should be surprised about this. I don’t think we can use the traditional methods of 100-year-storms. We’ve proven with Irene, and the July flooding, and then just five months later another storm.” Irene was the name that meteorologists gave to a hurricane that devastated the East Coast of the United States in 2011, taking a particularly hard toll on Vermont, a state where residents are known in the rest of the country for having a close relationship with nature.

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