Two California Democratic lawmakers have introduced legislation that could allow people and insurers to sue oil and gas companies for damages sparked by climate change-related disasters such as wildfires and mudslides.
The Affordable Insurance and Climate Recovery Act, authored by state Sens. Scott Wiener, D-San Francisco and Sasha Renée Pérez, D-Pasadena, accuses fossil fuel companies of misleading the public about the impact of their products on climate change.
The bill comes during the very early recovery stages of the devastating wildfires in Southern California earlier this month which have killed at least 28 people and burned more than 35,000 acres. If the measure passes, California would be the first state in the U.S. to allow for such legal action, Wiener told reporters at a news conference Monday in Sacramento.
“We are all paying for these disasters, but there is one stakeholder that is not paying: the fossil fuel industry, which makes the product that is fueling the climate change,” said Wiener, flanked by consumer protection and environmental group advocates. “The fossil fuel industry has endless resources, its profits just continue to spiral and spiral into the stratosphere. And we are left holding the bag in terms of paying for these disasters.”
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Due to the spike in climate-driven natural disasters, seven of the top 12 insurance companies in California have paused or limited new business in the last year and a half, despite rate increases approved or pending with the state’s insurance department.
Under the proposed measure, people insurance businesses impacted by natural disasters may be able to recoup losses from fossil fuel corporations. Among the insurance companies would be those under California’s FAIR Plan, the state insurance option for those who can’t get private insurance and are considered by some as a last resort.
Wiener said fossil fuel companies need to be a part of the solution for home and business owners who lose their properties.
“By forcing the fossil fuel companies driving the climate crisis to pay their fair share, we can help stabilize our insurance market and make the victims of climate disasters whole,” Wiener added in a statement announcing the bill.
Pérez pointed to the devastating impact of the wildfires, including the Eaton Fire, which burned more than 14,000 acres alone and destroyed more than 9,000 structures in her district.
“The reality is that climate change is here, and the fossil fuel industry has known this for decades,” Pérez said in a statement. “Now, communities like mine are paying the price, and it’s time for Big Oil to take responsibility.”
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The suit already has its detractors. The Western States Petroleum Association, which represents oil and gas companies in five states, said it will oppose it. In a statement, president and CEO Catherine Reheis-Boyd said state lawmakers are using the wildfires to “scapegoat” the industry. The state’s economy heavily depends on oil and gas, even as California looks to reduce its carbon footprint, she said.
“We need real solutions to help victims in the wake of this tragedy, not theatrics,” Reheis-Boyd said. “Voters are tired of this approach.”
California State Sen. Roger Niello, R-Roseville, the vice chair of the Senate’s Insurance Committee, told reporters at Monday’s news conference that he takes exception to the bill.
“This furthers the false narrative that this is all about climate change. It is of course much more complicated than that,” said Niello, noting he believes the state’s Democratic leaders underfund forest management projects statewide and Los Angeles leaders cut funds from the fire department’s budget.
“Do those issues have anything to do with the conflagration that we’ve seen in Southern California? I think so,” Niello said. “So will Senator Wiener and Perez include in their bill the ability to sue those entities for their role in this, too?” Niello asked.