Delays in moving forward with New York State’s sweeping climate action law are stirring up concerns among its ers that Gov. Kathy Hochul is seeking to avoid a perceived political price — with echoes of the ongoing battle over congestion pricing.

As part of her State of the State agenda last month, Hochul said state agencies have until the end of 2025 to propose just one element of required regulations. That misses the Climate Leadership and Community Protection Act’s deadline by nearly two years and with no sign of when the rest might follow.

That law, enacted in 2019, requires the state to drive down planet-warming emissions and shift away from fossil fuels, touching on nearly every sector of the economy and costing a projected $300 billion.

Nearly six years later, the goals at the heart of the CLA remain aligned with what climate scientists agree is urgent and necessary to mitigate and adapt to the impacts of a warming globe, but the political and economic environment have changed. Notably, federal funds ing New York’s progress may disappear thanks to Trump’s federal funding freeze. 

But Hochul has had other priorities and expressed a willingness to “rethink” where climate fits into her agenda. Her current main theme is “Making New York State More Affordable,” and the governor has been sensitive to anything that might hit New Yorkers’ wallets. That includes measures that would advance aspects of the climate law — but could also raise household costs.

“It was a different time,” Hochul said in July, noting that the climate law ed under her predecessor, Andrew Cuomo, adding “I can’t be caught in the past of 2019 into 2024 and 2025 and make decisions based on that, because a lot has changed.” 

She called the climate goals “something I would love to meet but also the costs have gone up so much, I now have to step back and say, “What is the cost on the typical New York family?’ just like I did with congestion pricing.”

Eight months ago, Hochul with lower tolls.

Hochul appears to be using the same playbook, this time applied to key elements associated with the state’s sweeping climate law. That includes a program known as cap and invest.

Cap and invest would raise money for climate-related projects by charging some entities that emit a significant amount of planet-warming gas for the emissions they spew, with a declining cap to drive down carbon over time. The program would also include rebates to low-income utility customers to offset any hike in bills that might come as a result.

While an came up with a blueprint to achieve the CLA, it did not create a spending plan, nor did it prescribe which actions to take first — leaving it up to lawmakers and the Hochul istration

Andrew Rein, president of the Citizens Budget Commission, said that lack of planning and prioritization means it’s hard to know what the most cost-effective emissions reduction strategies or resiliency investments might be.

“We’ve got to pick and choose what we’re going to spend,” Rein said, referring to the state. “People are advocating for positions and keep debating, which makes it hard to be flexible with circumstances and facts as they change. That’s where I think New Yorkers have to come together and say, ‘We have to balance affordability, the economy and environmental needs. What can we do together?’”

Political Climate

Hochul’s recent announcement indicated the first cap-and-invest rules, related to emissions reporting, would come out by the end of this year. That means the cap-and-invest program wouldn’t likely take effect until late 2026 or sometime in 2027 — after the next election for governor. 

Meanwhile, New York is falling behind on two key requirements of the CLA: sourcing 70% of its electricity from renewables like solar and wind by 2030, and reducing planet-warming greenhouse gas emissions 40% below 1990 levels by 2030 (and 85% by 2050). New York is about three years behind the first target and has so far reduced emissions about 9% below 1990 levels, according to the latest data available.

Paul DeMichele, a spokesperson for Hochul, emphasized state agencies are continuing the cap-and-invest rulemaking process. But some aren’t convinced. Hochul’s slow-walking the cap-and-invest program is “110%” tied to her concerns around her reelection prospects, said John Raskin, president of the Spring Street Climate Fund and a political strategist.

“It’s reasonable she wants to take care of people’s immediate needs, but she’s not doing herself any political favors by rejecting or stepping away from climate action,” Raskin said. “If she wants to improve her poll numbers and for people to see her as a leader, she should move forward on  climate action while communicating how it helps to meet people’s needs.”

Already, the Department of Environmental Conservation and the New York State Energy Research and Development Authority blew past the January 2024 deadline the CLA set for coming up with regulations. Michael Gerrard, director of the Sabin Center for Climate Change Law at Columbia University, contends the governor is violating the law. 

“I think Gov. Hochul was exceeding her authority much as she did when pausing congestion pricing, and DEC has a legal obligation to issue the regulations,” Gerrard said. “Cap and invest would generate revenues that could be used to build more renewable energy and more energy efficiency — things that the federal government is pulling back on.”

Gerrard spearheaded a lawsuit against Hochul’s congestion pricing pause, and now suggests legal action to challenge the cap-and-invest program delay could be on the horizon.

In a hearing in January on Hochul’s proposed state environmental agency budget, lawmakers questioned the new timetable, while agency officials maintained they were in fact moving ahead with the provisions of the CLA, including cap and invest.

“We need to get this right,” said Interim DEC Commissioner Sean Mahar. “If we’re going to have an economy-wide program that addresses climate emissions, we need to make sure that New Yorkers are prepared for it and that is what we have been doing and will continue to do.”

In the days after the hearing, lawmakers — mostly Republicans but some Democrats — released statements raising concerns about costs the CLA would impose on businesses, households and the state’s economy generally. In one, Republican Sen. Mark Walczyk referred to the CLA as “New York’s Green New Deal,” calling it “a financial nightmare that will burden families.”

Hochul may be facing a possible Republican challenger in Rep. Mike Lawler (R-Hudson Valley), who has been a vocal critic of the governor and, as a lobbyist, previously represented a fossil fuel utility company association that fought the climate law, New Yorkers for Affordable Energy.

Sen. Pete Harckham (D-Hudson Valley), chair of the Senate Committee on Environmental Conservation, countered criticism of the CLA by pointing out that climate change impacts have only worsened since the law was enacted. Some investments could save money down the road, he added, a point NYSERDA staff made during public hearings about the CLA in years past.

“We need to be redoubling our efforts,” he told THE CITY. “Clean energy is cheaper than fossil fuel energy. I reject the equivalency that this is more expensive. In the long run, this is going to be much less expensive.”

The price on carbon through a cap-and-invest program could increase fuel costs for New Yorkers, including low- and middle-income households, in the short term, but rebates kicking in could result in net savings, according to a state analysis. Two reports issued by environmental groups in January showed how a cap-and-invest program could benefit low-income New Yorkers, depending on its design.

“We are literally showing you research and making a case that we are helping the exact New Yorkers that you say you want to from an affordability angle,” said New York City Environmental Justice Alliance Deputy Director Eunice Ko, who worked on one of the reports. “This is just one tool. We’re not saying it should be the only tool, but we need things like this, absent federal and federal funding.”

Gerrard said New York can’t achieve the CLA goals without a cap-and-invest program — though the program alone won’t bring down emissions to the levels mandated under the law.

Beyond the emissions-reductions gains, revenue that could come from a cap-and-invest program would be important in the wake of the Trump istration’s Inflation Reduction Act. 

NYSERDA President Doreen Harris told NYSERDA’s board that her team is assessing the impacts of the funding freeze. She acknowledged it “has potential significant implications, of course, on funds that we are deploying at NYSERDA and, frankly, across our state” for clean energy-related work.

Hochul pledged $1 billion over the next five years for climate action — focusing on projects related to transportation and buildings — in her executive budget. DeMichele, the spokesperson for the governor, called it “the largest climate investment in New York’s history to accelerate our transition to a clean energy economy.”

In an interview Monday with The Capitol Pressroom, Harris said those funds would be deployed over five years “to get this transition moving even while cap and invest is advancing through its regulatory steps.”