Assemblymember Dawn Addis and Senator Caroline Menjivar introduced parallel bills that would require oil companies to pay for climate damage from past emissions. The bills would also assess fees and use the funds for climate programs. A similar bill was introduced last year, and the bill comes shortly after a bill that would allow individuals and insurance companies to sue oil companies for a “climate disaster or extreme weather or other events.”
AB 1243 and SB 684 would enact the Polluters Pay Climate Superfund Act of 2025. The act would establish the Polluters Pay Climate Superfund Program, which would require fossil fuel polluters to pay “their fair share of the damage caused by greenhouse gases released into the atmosphere” during the 1990 and 2024 calendar years. This would include emission from the extraction, production, refining, sale, or combustion of fossil fuels or petroleum products. The payment is required to “relieve a portion of the burden to address cost borne by current and future California taxpayers.” The California Environmental Protection Agency would administer the program.
Responsible Parties
The bill would require the California Environmental Protection Agency to publish a list of responsible parties within 90 days of the bill’s enactment. A responsible party is an entity with a majority ownership interest in a business engaged in extracting or refining fossil fuels that did business in the state or otherwise had sufficient contact with the state during the covered period and is responsible for more than 1 billion metric tons of fossil fuel emissions globally from 1990 to 2024.
Climate Cost Study and Cost Recovery Payment
This California Environmental Protection Agency must complete a climate cost study within a year of the passage of the bill that quantifies the total damage amount. The bill defines this amount as all past and future climate harms and damages to the state from calendar year 1990 through calendar year 2045. The agency must update the climate cost study at least every five years, through January 1, 2045.
The agency must also assess each responsible party’s proportionate share of the total damage amount, and responsible parties must then pay their cost recovery demand into the Polluters Pay Climate Superfund Fund in the state treasury. The fund would be used to pay for projects and programs to mitigate, adapt, or respond to the damages and costs caused to the state from climate change.