Legislation now under consideration by the Maryland legislature, the Responding to Emergency Needs From Extreme Weather (RENEW) Act of 2025, aims to hold energy producers liable for the effects of climate change by effectively forcing them to pay reparations. Modeled on legislation passed in New York and Vermont, the RENEW Act would establish a fund, paid into by producers of fossil fuels, to fund climate resilience and clean energy projects. Advocates for the legislation hope to collect an astounding $9 billion dollars from energy producers to finance their programs.

Beyond the fact that the bill is likely unconstitutional, it would have a disastrous effect on Maryland families and businesses if implemented — leading directly to higher prices on the energy we use every day. This is unacceptable, especially given that there are much more practical solutions at policymakers’ disposal to address environmental issues. Maryland’s state legislators should vote “no” on this disastrous bill for three main reasons.

First, the bill is likely in conflict with federal law and Supreme Court precedent. RENEW would apply costs and liability to energy producers retroactively — all the way back to March 1994 — which likely violates both equal protection and due process rights under the Constitution. It also likely violates the excessive fines and takings clauses of the Constitution, which prohibit imposing massive penalties on individual companies that should be shared across a wider range of stakeholders. The Supreme Court has previously acknowledged greenhouse gas emissions are a global phenomenon and therefore are subject to regulation under federal, not state, law — particularly under the Clean Air and Clean Water Acts. Maryland’s own Baltimore City Circuit Court Judge Videtta Brown recently affirmed this precedent in dismissing Baltimore’s recent legal activist case trying to similarly penalize energy producers under state law.

Second, the bill would create an unpredictable regulatory environment for Maryland businesses. Commenting on RENEW, the Maryland Chamber of Commerce expressed concern that “domestic companies will take on greater costs as companies not completely connected to the state, like foreign entities, may argue that they have insufficient connections to Maryland and do not satisfy the nexus requirement of the U.S. Constitution.” It would needlessly punish job creators here in Maryland. RENEW sets a dangerous precedent for singling out individual industries for punishment. This is not conducive to creating a business-friendly environment for Maryland.

Third, the RENEW Act would likely result in higher energy bills for Maryland businesses and families. According to the Energy Information Administration, Maryland still requires fossil fuels to meet energy needs: As of 2022, 75% of the state’s electricity comes from non-renewable sources. On top of that, grid manager PJM predicts that power demand will outpace supply from 2024-2034. At the same time, news reports have noted that Baltimore Gas and Electric anticipates an average monthly bill increase of roughly $18 a month beginning this coming summer.

This is catastrophic for families working hard to make ends meet, adding up to an estimated 11% subtraction from household budgets. The last thing we need is to place new costs on a struggling energy system. It’s basic economics: Penalizing producers as demand goes up will result in higher costs for consumers.

Ultimately, Maryland officials should simply say “no” to the RENEW Act. In a period of already-elevated prices, the last thing our neighbors need is an unnecessary hike on their energy bills. New York, which passed a similar bill, should serve as a cautionary tale. As New York resident Justin Wilcox put it for USA Today, similar legislation enacted in New York State sends “a chilling signal about New York’s stance toward business and industry — a position likely to exacerbate the ongoing outmigration of companies and residents seeking more favorable economic climates.”

Maryland should not go the way of New York’s extreme and out-of-touch climate agenda. Instead, we should press our legislatures to focus on practical solutions to address climate change, such as applying for funds that Washington has allocated for climate resilience and infrastructure through the Infrastructure Investment and Jobs Act. This is the kind of commonsense solution we should expect from our representatives — not wasting taxpayers’ time and threatening Maryland businesses with performative and punitive activist legislation.

Christopher B. Summers (csummers@mdpolicy.org) is president and chief executive officer of the Maryland Public Policy Institute.