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The Biden administration released a draft report on Tuesday warning of potentially negative impacts on Americans should the president’s moratorium on liquefied natural gas (LNG) exports be lifted.
The report, which concludes this growth in LNG exports could send U.S. energy prices up as much as 30% in the coming years while contributing to carbon emissions, was quickly met with pushback from energy industry officials who dismissed it as a call “politically motivated” to environmentalists. Meanwhile, an environmental group criticized the same report as “weak and half-hearted”.
The study comes weeks before President-elect Donald Trump takes office and follows President Biden’s decision in January pause all new US LNG exports to countries outside the Free Trade Agreement, citing the need to better account for the climate and economic impacts of such “significant” growth in LNG sales to buyers in Asia and Europe. President-elect Trump promised on the campaign trail to quickly reverse Biden’s moratorium once he’s in office.
The analysis of the draft reportwhich is now open for a 60-day comment period, found that US LNG growth could cause US consumer prices to rise by as much as 30% in the short term. Also, while it stopped short of recommending a total ban on LNG exports, in recognition of short-term demand from other countries, it also focused heavily on the negative impacts for American consumers , which Energy Department officials say could see energy prices rise by approx. $100 by 2050 as a result of tighter demand.
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An LNG tanker is seen in Port Canaveral, Florida. (Malcom Denmark/Florida Today)
The analysis noted that increasing U.S. LNG exports beyond currently permitted levels could result in up to 1.5 gigatons of CO2-equivalent emissions to the atmosphere by 2050, or about 25% of annual greenhouse gas emissions of the country.
However, industry groups have rejected this claim. A senior industry official told Fox News Digital that this model data set for a scenario that assumes LNG export growth does not replace any other form of energy consumption, such as coal, the largest fossil fuel dirty Actually, this person noted, LNG is it is expected to help offset coal consumption in the EU and elsewhere up to 50-60%, according to estimates by the International Energy Agency.
Although the analysis found that the increase in exports would result in a roughly 0.2 percent increase in U.S. GDP, Energy Department officials told reporters Tuesday that the increase in GDP ” does not necessarily correlate with a positive effect on public and consumer welfare.”
Accompanied by tugs, the LNG carrier “Hellas Diana” transports a cargo of LNG to the energy terminal “Deutsche Ostsee” on August 28, 2024. (Stefan Sauer/dpa/Sipa USA)
In a statement released alongside the report, Energy Secretary Jennifer Granholm noted that increasing LNG exports “would generate wealth for owners of export facilities and create jobs across the chain of natural gas supply,” but suggested that the domestic price of natural gas would rise. .
The study comes as US sales of refrigerated natural gas have increased. The United States rose to become the world’s top LNG exporter by 2023, and current capacity is already slated to double by the end of the decade based on current projects, according to Energy Information Administration estimates.
It also comes as Russia’s War in Ukraine has sparked new demand from US allies in Europe, which have been scrambling to buy LNG to offset the loss of Russian pipeline gas, and Japan, an import-dependent nation that receives up to 90% of its its energy from external suppliers.
The report, released just weeks before Trump took office on Jan. 20, sparked a backlash from natural gas advocates.
Q-LNG4000, Port Canaveral’s liquefied natural gas tanker, was fueling Carnival Mardis Gras in port. (Malcom Denmark/Florida Today)
“Today’s report from Energy Secretary Jennifer Granholm is clearly a politically motivated document designed for an audience that believes no form of carbon-based energy is acceptable,” said Jay Timmons, director general and president of the National Association of Manufacturers (NAM). “LNG exports play a crucial role in reducing emissions by providing cleaner energy alternatives to countries that rely on higher-emitting sources.”
For its part, NAM conducted a study on the ban that found nearly 1 million jobs would be threatened by the LNG hiatus over the next two decades if the restriction remains in place, Fox News Digital previously reported.
American Gas Association CEO and President Karen Harbert described the report as a “clear and inexplicable attempt to justify their grave policy mistake.”
“America’s allies are suffering natural gas weaponization and energy deprivation, and any limitation on the supply of energy essential to life is absolutely wrong,” Herbert said in a statement, adding: ” The Biden Administration’s pause in U.S. LNG exports was a mistake and created uncertainty for the market, for investors, and for America’s allies around the world.”
The report, however, is not without criticism from the left.
Environmental group Food & Water Watch also criticized the Biden administration for the “weak” report warning against LNG exports.
“This study reflects the Biden administration’s entire four-year approach to advancing a clean energy future: weak and heartless,” Jim Walsh, director of policy at Food & Water Watch, said in a statement. “We cannot continue to be victimized by the profit agenda of fossil fuel corporations. President Biden must heed the warnings of his own administration by banning further LNG exports and rejecting pending LNG permits before he leaves office.” .
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President-elect Trump, meanwhile, has also repeatedly pledged to undo the LNG hiatus upon taking office and to “unleash” US energy exports, blaming high costs and supply problems on the administration coming out of Biden.
In October, he promised at a campaign rally that American residents would see energy prices cut “in half” within a year of his inauguration.
More recently, he promised to “go hard on the issue” by moving to raise immediately Biden’s LNG Pause to allow new LNG exports after its inauguration, sources familiar with the transition plans told Reuters.
