For the second year in a row California lawmakers have failed to advance their much-hyped “climate superfund” legislation – a pair of bills that would impose retroactive fees on oil companies for their alleged contributions to climate change.
Lacking any clear evidence of climate liability, the proposed measures risk adding yet another cost burden in a state where residents already face some of the highest energy prices in the nation. Gasoline currently averages $4.78 per gallon in California – nearly $1.40 above the national average.
Bills Pulled From Key Committee Hearings
Last week, both SB 684, sponsored by State Sen. Caroline Menjivar, and AB 1243, sponsored by State Sen. Dawn Addis, were quietly pulled from key Judiciary Committee hearings just days before the deadline for bills to pass policy committees. The sponsors claimed the legislation could still move forward later this year thanks to a tax-bill exemption, but the delay suggests serious problems behind the scenes as California struggles to address out of control energy costs.
Even among Democrats, support appears shaky. Menjivar said she pulled her bill after Senate Judiciary Chair Tom Umberg proposed converting it into a study bill, a move that signaled the legislation didn’t have the votes to pass in its original form. Umberg was also amongst several Democratic lawmakers who voted against SB 222 earlier this month, legislation that would have allowed insurers and individuals to file lawsuits against big oil over recent wildfire damages. Governor Gavin Newsom, who backed the state’s climate lawsuit against American energy in 2023 has stayed conspicuously quiet on the legislation.
The delay marks another blow to national activist groups like the Rockefeller Family Fund, which played a behind-the-scenes role in drafting similar legislation in New York and Vermont, where so-called “climate superfund” laws passed in 2023 and 2024.
Menjivar acknowledged the frustration directly:
“California claims to be leading in environmental justice,” said Menjivar at a press conference Tuesday morning. “Yes, we are in a lot of spaces, but Vermont and New York went first.”
In theory, California – long the epicenter of frivolous attacks on American energy – should be fertile ground for environmental activists pushing aggressive anti-fossil fuel regulation. However, last week’s retreat demonstrates a shifting political calculus in Sacramento, where affordability has taken center stage.
The California Chamber of Commerce placed both bills on its “affordability agenda,” a rising concern for California voters overwhelmed with the state’s day to day expenses. Labor unions also raised concerns over the potential economic fallout, especially in industries already facing rising regulatory costs and refinery shutdowns.
Legal Questions Loom
Even if passed, the bills would face major legal hurdles. A coalition of state attorneys general has already filed challenges against the New York and Vermont laws, arguing that such state-level climate superfunds improperly conflict with federal authority and violate long standing limits on retroactive liability. And late last week, the DOJ sued the two states, calling their superfund laws “monetary-extraction schemes” that violate federal law.
The actions come after President Trump directed the Department of Justice to review policies like superfund legislation that infringe on energy dominance and “expeditiously take all appropriate action to stop the enforcement of State laws and continuation of civil actions … that the Attorney General determines to be illegal.”
That legal uncertainty, paired with the potential to raise energy costs and invite economic disruption, is clearly giving California liberals pause – even in one of the country’s most extreme state capitols.
BOTTOM LINE: If “climate superfund” bills can’t survive in Sacramento, it raises serious questions about their viability elsewhere – and about the growing political cost of driving up energy prices for politicians who embrace them.
