New York Gov. Kathy Hochul, a Democrat, signed the bill in 2024. It would have required oil companies to pay a total of $3 billion a year for the next 25 years.
The 2024 bill was part of a broader attempt by Democratic-leaning states to pursue climate change policy by attacking fossil fuel companies.
The proposal, currently being considered by the Legislature during budget talks, would put off regulations for enforcing the law until 2030.
The battle to lower costs has reached the State Capitol, where concerns have emerged about the fate of a 2019 climate law and its ambitious goals to reduce greenhouse gas emissions.