By Timothy Gardner
WASHINGTON (Reuters) – U.S. President Joe Biden’s administration on Tuesday released a long-awaited study on the economic and environmental impacts of liquid liquid exports, saying the results underscore the need for a cautious approach to new permits.
Biden had in January suspended the Department of Energy’s approval of U.S. LNG exports to major consumers in Asia and Europe so his administration could conduct the review, prompting complaints from the oil and gas industry.
“The key takeaway is that a business-as-usual approach is neither sustainable nor advisable,” Energy Secretary Jennifer Granholm told reporters ahead of the study’s release. Granholm said in a letter about the study’s findings that rising LNG exports risk dramatically increasing greenhouse gas emissions and could also cause price increases for U.S. energy consumers.
President-elect Donald Trump, a climate change skeptic and a strong supporter of fossil fuel development, has pledged to immediately end the moratorium on new LNG export permits when he returns to the White House on January 20.
The study included different scenarios of the impact of LNG exports depending on domestic and international climate policies, technologies and resource availability.
In all scenarios, the study found that U.S. natural gas supply is sufficient to meet domestic fuel demand and global demand for U.S. LNG. But in a scenario with no restrictions on LNG exports, domestic gas prices would rise 31% by 2050, it found, raising natural gas bills for U.S. households by more than $100 a year, with prices varying by region.
The research is intended as a source of information for decisions by the Energy Department on new permits to export the gas. The department is legally required to determine whether the export is in the public interest.
Liquefied natural gas is natural gas that has been supercooled to a liquid state, which reduces its volume and allows it to be transported to places where pipelines cannot reach.
Asked whether the study’s results would give LNG opponents legal grounds to challenge new LNG export permits in court, a DOE official, speaking on condition of anonymity, told reporters that this would have to be a consideration first. are for every US energy secretary. The official added that proponents of caution on LNG have several options in Congress and the courts, which the investigation could reveal.
The study shows that Europe has been the main destination for US LNG since 2016, mainly as the region turns away from Russia’s gas after the invasion of Ukraine in 2022, but that global demand and destination of US LNG will be less be sure.
“European policies are moving to reduce the use of fossil fuels, including natural gas,” the study said. “Demand for natural gas and LNG in Asia is expected to increase in most countries
scenarios.”
LNG supporters said the U.S. investigation was influenced by politics in an election year.
A study from S&P Global, also released Tuesday, shows that US LNG has contributed more than $400 billion to US GDP over the past decade, supported approximately 273,000 jobs and will add approximately 495,000 jobs through 2040.
“LNG exports are not only in America’s national interest, but also in the interest of the world, including our European allies as we move away from dependence on Russian gas,” the U.S. Chamber of Commerce said in a press release about the investigation from the Biden administration.
