Wildfire, Trump, and California’s climate compromise

Days after the start of 2025 two fires burned to ashes through Los Angeles neighborhoods, the most destructive in California history. Eaton and Pacific Palisades fires also renewed attention to issues such as utility oversight, insurance coverage, and the broader challenges of forest fire planning in a changing climate. And their damage spread outward, leaving thousands of low-income workers and immigrants behind no jobs.

But California found is pushing its climate agenda forward to be a tough fight this year: Aambitious climate goals faced hostile economic pressure from the federal government.

Anticipating opposition from President Donald Trump, state leaders chose to abandon important clean air rules before he even took office, including plans to phase out diesel trucks and moving to cleaner trains. As the middle of the year approaches, Trump and his allies in Congress blocked the state’s mandate for clean cars, a blow to plans to cut emissions.

However, as part of the budget negotiations, Gov. Gavin Newsom sought reauthorization California’s landmark cap-and-trade program, launching a debate that will be decided in the final hours of the legislative session.

Blaming climate and environmental regulation, Phillips 66 and Valero went ahead with plans to close oil refineries, causes concern on gas prices and the future of the state’s oil industry. In Wilmington, Phillips 66 is now closed. A loud explosion at Chevron’s El Segundo refinery nearby emphasized ongoing safety and environmental risks associated with the remaining facilities.

By the end of the legislative session, those issues had converged as lawmakers passed six note deal it included a plan to boost oil drilling, relief for ratepayers who fund wildfire mitigation, and an expansion of the now-renamed cap-and-invest program.

As lawmakers passed sweeping reforms to California’s landmark environmental review law, critics warned that the exemptions could potentially facilitate highly polluting advanced manufacturing facilities to take root in already vulnerable areas.

Long-standing conflicts over water continued to simmer this year. The governor continued to insist speeding up a $20 billion tunnel around the Sacramento-San Joaquin Delta to send more water south— to the outrage of Delta MPs. And the dry conditions led to dire forecasts for the Colorado River, vital water supply for Southern California. They stepped up the tension – and the urgency — as negotiators from countries relying on the river tried, and failed to reach a deal rationing of water supplies.

Outlook for 2026

Affordability, the costs of climate adaptation, and the harms of pollution in the air and in the waste stream continue to be key issues for California. As Gov. Gavin Newsom’s balancing act continues, the state will manage tensions with environmental justice advocates unhappy about the compromises. Emerging risks include the costs – in energy and water – of data centers and the environmental implications of battery economy.