On October 24, 2025, the Albany County Superior Court (Court) issued a decision and order Citizen Action of New York et al v. New York State Department of Environmental Conservation, Index no. 903160-25, NYSCEF Document #93. The court ordered the New York State Department of Environmental Conservation (DEC) to adopt regulations to meet emissions reduction requirements under the state's 2019 law Climate Leadership and Community Protection Act (CLCPA). The CLCPA amended the Environmental Conservation Law (ECL) to include Article 75, which sets statewide greenhouse gas (GHG) limits and directs DEC to adopt regulations to ensure compliance. Pursuant to this authority, ECL § 75-0109 required DEC to adopt rules “to ensure compliance with the statewide emission reduction limits set forth in § 75-0107.” The court's order gives DEC until February 6, 2026 to finalize these implementing regulations.
background
In 2019, then-New York Governor Andrew Cuomo signed the CLCPA, which sets two statewide targets for greenhouse gas emissions: a 40 percent reduction from 1990 levels by 2030 and an 85 percent reduction by 2050. The law directs the DEC to issue regulations to achieve these goals, but implementation has been economically difficult.
In early 2023, DEC and the New York State Energy Research and Development Authority (NYSERDA) initiated the rulemaking process to establish a New York Cap and Invest (NYCI) program and conducted extensive outreach to solicit stakeholder input. In December 2023, DEC and NYSERDA published one Preliminary draft sketch Description of the structure and major components of the upcoming rulemaking. The outline previewed three parts: the mandatory greenhouse gas reporting rule, the cap-and-invest rule, and the auction rule.
The mandatory greenhouse gas reporting rule establishes standardized methods for collecting and verifying greenhouse gas emissions data from covered sources across the state, including utilities, fuel suppliers and large industrial facilities. Accurate reporting is essential to determining the statewide emissions baseline and assigning compliance obligations under the program.
The cap-and-invest rule proposes a program that sets an annual cap on the amount of greenhouse gases that can be emitted in the state. DEC will allocate an appropriate number of tradable certificates to meet this limit. Obligated companies must then purchase allowances at auction and surrender allowances equal to their greenhouse gas emissions for each compliance period to DEC. Proceeds from the sale of allowances would be invested in state decarbonization initiatives and distributed to New Yorkers, potentially offsetting program costs passed on to consumers. The proposed mandatory entities would include stationary sources that meet the annual GHG emissions limit of 25,000 tons of CO₂e and fuel suppliers that sell 100,000 gallons of liquid fuel or 15,000,000 standard cubic feet of gaseous fuel to end users in New York, based on emissions data reported under the state's mandatory GHG reporting rule. Emissions below these thresholds may continue to give rise to obligations at fuel supplier level and requirements for the electricity sector continue to be assessed.
The auction rule would regulate the sale and distribution of emission allowances under the cap-and-invest system. The rule would describe the operation of NYCI allowance auctions and mechanisms to protect the overall integrity of the allowance market, prevent market manipulation, and provide cost containment and program stability.
In January 2025, Governor Kathy Hochul's administration paused development of the NYCI program and stated so in her annual State of the State address Briefing book the delay would be “created[e] more space and time for public transparency and a robust investment planning process.” It is this tension between the legislative branch's ambitious mandates and the executive branch's measured approach that is at the core New York Citizens Action.
In March 2025, DEC published the greenhouse gas reporting rule for public comment and indicated that feedback received would inform the development of the remaining rules. The public comment period for the GHG Reporting Rule ended July 1, 2025. As of this publication Alarm, The DEC has not yet published its responses to the comments received or opened a public comment period for the remaining two rules under the NYCI program.
Shortly after the greenhouse gas reporting rule was published, on March 31, 2025, a coalition of environmental organizations filed a petition alleging that DEC had missed the January 1, 2024 ECL § 75-0109(1) deadline. New York Citizens Action At issue was the interpretation of ECL § 75-0109(1), which requires the DEC to adopt regulations “not later than four years after the effective date of this article” or by January 1, 2024, after at least two public hearings, to ensure compliance with statewide emissions limits. The petition sought a court order requiring DEC to issue full regulations by February 6, 2026.
Effects of the court decision
On October 24, 2025, the Court granted the petition and ordered DEC to complete the entire regulatory package consistent with the CLCPA by February 6, 2026. The court rejected DEC's argument that additional time was needed to refine or phase in the regulatory framework, emphasizing that such discretion was not provided for in the law. The court wrote, “Whether DEC is right or wrong to make this judgment is beyond its authority under the CLCPA.” And while the court gave DEC a short period of time to complete the rulemaking process, it made clear that this freedom had its limits. The court warned DEC that “[r]“Respondent is advised that the Court is unlikely to grant any extensions to this deadline as it has given it time to both develop its regulations and address its concerns to policymakers.”
It is unlikely that DEC will meet the court's February 6, 2026 deadline. Pursuant to Section 202 of the State Administrative Procedure Act, each proposed regulation must be subject to a public comment period of at least 60 days. DEC must then review and respond to public input before finalizing the rules. To allow DEC additional time to finalize the regulations, DEC may appeal the decision and request an automatic stay of the lower court's order. Lawmakers could also amend the statute before the end of the year to give DEC more flexibility or additional time to develop and implement necessary regulations. Whether that happens depends on coordination between the governor and the Legislature and raises broader questions about the balance of power between the executive and legislative branches in shaping New York's climate policy.
Going forward, the resolution of whether the DEC complies with the Court's order, whether through expedited legislation or legislative action, will have a significant impact on the State's ability to meet its statutory climate goals.
If mandatory greenhouse gas reporting and compliance requirements were finalized as part of a cap-and-invest program, obligated companies would incur significant compliance costs. Interested parties, particularly those that would be considered “obligated entities” under the December 2023 interim proposal, will have an opportunity to review and comment on the final proposed rule. Potentially regulated parties may wish to comment on issues such as the expected financial impact of the program on businesses and consumers, the administration of the program, the reporting requirements, or the interaction of the program with other regulatory systems (such as the Regional Greenhouse Gas Initiative and federal greenhouse gas emissions reporting requirements).