By Wayne Arden, Vice-Chair, Sierra Club New York City Group

The end of the 2026 legislative session in Albany did not go as we hoped. Governor Hochul succeeded in watering down the provisions of the Climate Leadership and Community Protection Act, known as the “Climate Act.” In addition, due to lengthy budget negotiations centering on the Climate Act that lasted nearly until the end of May (nearly two months late), few environmental bills championed by the Sierra Club advanced. Here are the major changes to the Climate Act:

Less rigorous GHG accounting: Over 20 years, methane traps about 80 times as much heat as CO₂, but over 100 years, methane’s effect is less strong, trapping about 28 times as much heat as CO₂. The Climate Act previously used a strong definition of emissions, most notably using a 20-year global warming potential to measure carbon dioxide equivalent emissions (CO₂e) for methane, aligning with climate science to understand the warming effects of the gas that are different than those of CO₂. The revised Climate Act now uses a 100-year standard. This relaxed standard discourages switching to electricity from natural gas, so pollution continues and energy bills remain volatile.

Less ambitious emission reduction targets: The Climate Act required a 40% reduction in emissions versus 1990 levels by 2030. The 2030 target is now voluntary. There is a new target in 2040, a 60% reduction. Moreover, the revisions added porous wiggle room: stipulating that regulations achieve emission reductions “to the maximum extent feasible and cost-effective.” The 2050 emissions reduction target remains unchanged at 85%.

Delayed DEC regulations to ensure compliance: Previously, the NYS Department of Environmental Conservation (DEC) regulations to ensure compliance were due January 1, 2024. Now they are due December 31, 2028. Columbia University Law School’s Sabin Center offers a more detailed discussion of the rollback.

Senator Krueger speaks for many frustrated voters who care about the environment: “There’s no penalty for the governor to have a late budget, and the longer she drags it out, the more things she’s able to get out of the Legislature. Sort of a blackmail arrangement, right? You don't get paid, and I’m just going to make more demands on you. And also, it gives us much less time to work on our big legislation post-budget, and she loves that also. She doesn’t want us to pass legislation. When we pass good legislation, she decides to do (executive orders) and take credit for it anyway.” 

Cap-and-Invest: In July, during a Politico interview , Governor Hochul proclaimed: “Please do not question my credentials in this space [climate and clean energy].” To quote a Texas friend, that proclamation is a case of “all hat, no cattle.” The Governor has greatly damaged her standing with the environmental community. In January 2025, just before the State of the State address, Governor Hochul’s team reached out to environmental groups, including the Sierra Club, urging us to beat the drum in support of the proposed Cap-and-Invest Program. Then, without notice or justification, she put it on the shelf.

The Cap-and-Invest Program is a linchpin initiative to help the Climate Act achieve its emission reduction targets. California’s Global Warming Solutions Act (AB32), which established California’s Cap-and-Trade Program (now called Cap-and-Invest), is on track to reduce emissions to 40% below 1990 levels, by 2030. 

The program has generated an average of $6.6 billion per year over the past three years. California reinvests these revenues to reduce utility rates (California Climate Credit) and in projects that further advance sustainability (GGRF—Greenhouse Gas Reduction Fund). Over half of GGRF investments benefit disadvantaged, low-income, and vulnerable communities, exceeding the statutory minimum of 35%. Comparing state GDPs, New York State may eventually realize up to $3 billion per year in Cap-and-Invest Program emission auction revenues.

What's Next?: How can Governor Hochul begin to restore trust with the environmental community? She should advance the Cap-and-Invest Program without delay. As a global center of finance, New York City and thus New York State have a leading role to play. If New York State links its program to those of California, Quebec, and Washington, it will create a de facto price for carbon in North America. 

New York City emissions comprise about 40% of the state total, and 69% are produced by buildings. Local Law 97, New York City’s cornerstone law for addressing climate change, incentivizes building owners to reduce use of fossil fuels by increasing efficiency and electrification. Cap-and-Invest will lower the carbon intensity of the electrical grid, supporting the emission reduction aims of Local Law 97. 

By implementing Cap-and-Invest, New York State can accelerate emission reduction progress in both the city and across the state. Moreover, given New York City’s influence as a preeminent financial center, the state can have a global impact in the fight against climate change—adding credibility and liquidity to strengthen the North American carbon market. And if New York joins the market, then other states and provinces are likely to follow.

The question is, will Governor Hochul’s actions match her words? In time, we’ll see whether her ranch has cattle or instead is barren, overrun with tumbleweeds.