California communities, reeling from climate impacts such as wildfires, argue against giving up the right to sue the fossil fuel industryCalifornia communities, many devastated by climate impacts like wildfires, argue against giving the oil industry immunity against liability lawsuits. Photo credit: Marcus Yam/Los Angeles Times via Getty Images
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By Karen Savage

A carbon dividend plan proposed by the Climate Leadership Council (CLC) is little more than a green-washed attempt to prevent local communities from holding fossil fuel companies accountable for damages they have done to the climate, leaders of six California municipalities wrote in a letter sent to Sen. Kamala Harris.

The letter seeks to rally opposition to the CLC’s Baker Schultz Carbon Dividend Plan, which proposes taxing carbon emitters and returning the proceeds to the American public. It also suggests that “a robust national carbon price would also make possible a historic emissions provision stipulating that no party should be liable for damages from past emissions that were legal at the time” and calls for a rollback of most emissions regulations.

The letter was initially sent last year to California’s two senators, Harris and Dianne Feinstein, by six communities who have filed climate liability suits against the oil industry: Richmond, Santa Cruz and Imperial Beach and the counties of Marin, San Mateo and Santa Cruz.

It was recirculated this week by the mayor of Richmond, Calif., Tom Butt, after 75 businesses, including Shell, BP, Microsoft, Johnson and Johnson, Exelon and PepsiCo, which are also founding members of CLC, met with lawmakers on Capitol Hill to call for the passage of meaningful climate legislation, including setting a price on carbon.  

“Their aggressive, well-financed campaign is built around a provision buried inside a carbon tax Trojan Horse proposal that attempts to prevent cities, counties, states, or others from holding fossil fuel companies accountable for climate change-related damages they knowingly caused,” Butt said.

“One thing is clear: fossil fuel companies are not supporting a carbon tax. They are supporting a repeal of greenhouse gas regulations and permanent immunity from those climate damages lawsuits.”

The lobbying meetings were arranged as part of a Ceres-sponsored Lawmaker Education & Advocacy Day (LEAD) on Carbon Pricing. It’s unclear if the companies lobbied specifically for the Baker Schultz plan, but they say they want to influence federal policy to tackle climate change.

“Microsoft believes it’s time for a serious national discussion on carbon pricing that can translate into policy action. The science is clear—climate change is a massive global challenge and we have limited time to make the kind of progress needed,” said Michelle Patron, director of sustainability policy for Microsoft, which drew criticism for joining the CLC in April.

In recent years the Market Choice Act and the Energy Innovation and Carbon Dividend Act have both been introduced in Congress. Neither proposed taking away the right to file climate liability suits.

Despite internal predictions by their own scientists of “catastrophic” climate impacts, the fossil fuel industry has worked publicly to highlight the uncertainty of climate science. Companies, including Exxon and Shell, have known for decades that their operations and products cause climate change and have worked to undermine national and international action to reduce carbon emissions.

Communities that have already begun pursuing liability suits are now sounding the alarm about efforts to take away that right to sue, a stipulation that often goes unmentioned in the advocacy for Baker Schultz.

CLC founder Ted Halstead failed to mention it at all while testifying about the plan at a Congressional hearing on the economic and health consequences of climate change earlier this month.

“These proposals are classic greenwashing and a fact-free, transparent attempt by fossil fuel companies to avoid the liability for decades of deception and denial about the consequence of burning fossil fuels,” said Daniel Zarrilli, New York City’s chief climate policy advisor.  

New York filed suit against five oil majors last year, seeking billions in damages to cover adaptation needed to protect New Yorkers from the increasing effects of climate change. “We will continue fighting to hold fossil fuel companies accountable for their greed and complicity in global warming,” Zarrilli said.

The Baker Schultz plan has been heavily promoted by CLC,  a 501(c)(3) policy institute founded by Halstead. It lists as co-founding members oil giants Exxon, BP, Shell, and Total; corporate giants Microsoft, P & G, Johnson & Johnson, Ford, GM, AT&T, MetLife, Pepsico, and Excelon; individuals Ben Bernanke, Michael Bloomberg, Steven Chu and Christine Todd Whitman; and the environmental organizations The Nature Conservancy and World Wildlife Fund.

The Climate Leadership Council’s gross receipts ballooned to $4,196,664 in 2017 from less than $50,000 in 2016, according to the organization’s latest available IRS filings.Tax records indicate the Council is also supporting work on a “new approach to carbon taxing in the U.K.”

In their letter to legislators, the municipalities said the cost to protect their residents from climate change is already staggering. They said the Baker Schultz plan would give companies a “free pass” by limiting communities’ access to the legal system.

“Shutting off access [to] the courts has no place in a functioning checks-and-balances democracy. Wealthy, powerful corporations should not get to decide whether they are subject to the same laws as everyone else,” said the municipalities.

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