New York State Budget Passes with First Statewide Fossil Fuel Ban on New Construction

On Thursday, New York Governor Kathy Hochul signed the 2023-2024 State Budget into law. Notably, the budget marks the passage of a first-of-its-kind statewide fossil fuel ban in new construction starting in 2026. The budget also includes $400 million in funding for the Environmental Protection Fund, the addition of over 265 jobs across multiple environmental agencies, and other environmental victories.

In response to the budget, Sierra Club Atlantic Chapter Conservation Director Roger Downs issued the following statement.

“Sierra Club applauds the legislature and Governor Hochul for understanding that a well-staffed workforce and a robust Environmental Protection Fund are vital to implementing New York’s groundbreaking climate law. We celebrate the passage of the nation’s first ban on fossil fuel equipment and building systems in new construction, set to start in 2026, as well as a plan to decarbonize New York’s most polluting state-owned buildings and campuses. Phasing out polluting, fossil fuel infrastructure from our homes and buildings, while creating family-sustaining jobs, is an integral step toward meeting our climate goals.

While the budget is inclusive of many climate and energy victories, it omits the NY HEAT Act, a necessary piece of legislation that would eliminate ratepayer subsidies for new gas hookups, end the obligation to serve gas in buildings, and ensure no low or middle-income families spend over six percent of their income on energy. The legislature must continue to act as climate leaders and pass the NY HEAT Act before the end of this legislative session if the all-electric buildings mandate is to be effective. In addition, the Sierra Club looks forward to working with state leaders to pass several other critical pieces of legislation that did not pass during budget season; bills that will support packaging reduction & recycling infrastructure, protect pollinators from harmful and unnecessary insecticides, and ban PFAS and other forever chemical from everyday products”

Key Achievements Included in the Budget

• Building Electrification: The nation’s first fossil fuel ban in new buildings of seven stories or less is set to begin in 2026. The ban for larger buildings will start in 2029. In addition, the budget finances the first steps to achieving zero onsite emissions through ‘decarbonization action plans’ for 15 thermal energy networks on public campuses and facilities with labor standards to ensure they will be built with good union jobs.
• Environmental Spending: The budget includes $400 million for the Environmental Protection Fund (EPF), $500 million for clean water infrastructure, as well as $202 million in funding for New York State Parks, and $90 million for the Department of Environmental Conservation. To support the implementation of the $4.2 billion Clean Water, Clean Air & Green Jobs Environmental Bond Act, the budget also allocates funding for the addition of 265 positions across multiple environmental agencies.
• Cap and Trade: The budget sets the foundation to create new revenue streams from climate polluters which will help fund an affordable clean energy transition and cap emissions, but will require more guardrails through regulation to protect disadvantaged communities.