Federal judge blocks New York's $75 billion climate superfund law

Chief U.S. District Judge Brenda Sannes blocked New York's $75 billion Climate Change Superfund Act on August 31, 2026, ruling that the state-level emissions compensation scheme is preempted by the federal Clean Air Act. Sannes sided with 22 Republican state attorneys general, the Trump administration's Department of Justice, and major industry groups. The law sought to charge fossil fuel companies $3 billion annually starting in 2028 to fund climate-adaptive infrastructure projects.

Federal court ruling

• ▪Chief U.S. District Judge Brenda Sannes ruled on August 31, 2026, that New York State cannot enforce its 2024 Climate Change Superfund Act
• ▪Chief U.S. District Judge Brenda Sannes's ruling relied heavily on a 2021 Second Circuit decision in which New York sued five fossil fuel groups for climate damages

Clean Air Act preemption

• ▪Chief U.S. District Judge Brenda Sannes ruled that New York's Climate Change Superfund Act was preempted by the federal Clean Air Act
• ▪Chief U.S. District Judge Brenda Sannes stated that the Clean Air Act does not authorize states to adopt emissions compensation schemes like New York's law

Superfund law provisions

• ▪Funds from the New York Climate Change Superfund Act were designated for climate adaptive infrastructure projects, including upgrades to roads, transit, and stormwater systems
• ▪The New York Climate Change Superfund Act applied to companies responsible for 1 billion tons of greenhouse gas emissions between 2000 and 2018
• ▪The New York Climate Change Superfund Act sought to charge fossil fuel companies $75 billion over 25 years, starting with $3 billion annually in 2028

Industry opposition

• ▪Industry groups, including the U.S. Chamber of Commerce, American Petroleum Institute, and National Mining Association, opposed the New York Climate Change Superfund Act
• ▪New Jersey Senator Michael Testa stated that New Jersey's similar proposed climate superfund bill should go no further following the New York ruling

Republican attorneys general lawsuit

• ▪A coalition of 22 Republican state attorneys general, led by West Virginia Attorney General JB McCuskey, filed a lawsuit in February 2025 opposing New York's law
• ▪The Republican attorneys general lawsuit argued that New York's law was a politically motivated overreach that could wipe out thousands of energy industry jobs

Trump DOJ involvement

• ▪The U.S. Department of Justice under President Donald Trump supported the Republican attorneys general in the lawsuit against New York's climate superfund law
• ▪Principal Deputy Assistant Attorney General Adam Gustafson stated that the Department of Justice is protecting American energy from state overreach

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