The Biden administration recently announced a temporary pause on new natural gas exports as part of its climate agenda. The announcement, which came in January 2024, was met with a mixed response. Those in favor, largely Democrats, applauded the administration for its work to protect the environment as well as for the potential to lower fuel costs for American consumers. Conservatives, however, argued that the move could make it harder for other countries to replace dirtier fuel supplies with cleaner natural gas from the U.S. and that it could be a threat to American jobs.
“President Biden’s politically motivated ban on American [liquid natural gas (LNG)] exports is a monumental mistake that benefits our adversaries and dirty global polluters like Iran and Russia,” Reps. August Pfluger (R-Texas) and Kevin Hern (R-Okla.) said in a written statement. “Unleashing U.S. LNG exports means more American jobs, a more secure world for America and our allies, and lower emissions.”
Pfluger sponsored a House bill, Unlocking our Domestic LNG Potential Act (H.R. 7176), to limit the Biden administration’s ability to pause natural gas exports. Specifically, the bill would remove the Department of Energy’s authority to reject natural gas export projects and would therefore give sole authority to approve or reject projects to the independent Federal Energy Regulatory Commission (FERC).
As it stands now, natural gas projects need approval from both FERC and the Energy Department to begin construction. H.R. 7176 passed the House in February by a vote of 224-200, with nine Democrats voting in favor with Republicans. “Since his first day in office, President Biden has targeted our domestic energy producers and actively undermined America’s efforts to be energy independent,” House Speaker Mike Johnson (R-La.) said in a statement after the bill was passed.
The Biden administration came out against H.R. 7176, stating that it would “undermine the ability of the United States to ensure that export of a critical and strategic resource is consistent with our economic, energy security, foreign policy, and environmental interests.” It added that the bill “would also strip back important safeguards that prevent price pressure on industrial and residential consumers, as well as vital consumer, domestic manufacturing, and energy security protections.”
The administration’s decision to pause natural gas export projects is expected to last at least 15 months and is meant to encourage greater assessment of how the country’s natural gas industry is affecting climate change and how it affects the local communities that facilitate the production and export of this energy supply.
“The current economic and environmental analyses [the Department of Energy] uses to underpin its LNG export authorizations are roughly five years old and no longer adequately account for considerations like potential energy cost increases for American consumers and manufacturers beyond current authorizations or the latest assessment of the impact of greenhouse gas emissions,” the administration stated in its announcement of the pause.
“We also must adequately guard against risks to the health of our communities, especially frontline communities in the United States who disproportionately shoulder the burden of pollution from new export facilities.” Administration officials also said that the pause, which could be repealed in the face of national security emergencies, will give regulators enough time to update and recalibrate the assessment criteria given the evolving nature of the industry and climate change.
The U.S. is currently the world’s largest exporter of LNG, and it is expected to double its export capacity in the coming years. Some Democrats worry that continual increases in exports could lead to higher LNG costs back home, similar to a situation in Australia, where the domestic price of LNG got so high that the government intervened and introduced price caps.
Arguing in favor of the pause at a House Energy and Commerce Committee hearing in February, Rep. Ann Kuster (D-N.H.) connected the increasing volume of LNG exports to “increased domestic gas prices, driving up the cost of cooking, heating and electricity for U.S. consumers and businesses.”
While the Republicans’ bill to stop the Biden administration’s pause passed the House, it is unlikely to see movement in the Democrat-controlled Senate and would face a veto if it reached the White House. Thus, the break in new export projects will likely remain in effect at this time. For background, see the May 2018 issue of Congressional Digest on “U.S. Energy Infrastructure.”
