Setting the Record Straight: United States LNG Export Approval Pause
(Washington, DC) – As media reports hint that the Biden Administration is considering a final ruling on its future LNG permitting, Natural Allies for a Clean Energy Future is aiming to set the record straight on the value of U.S. liquefied natural gas (LNG) both here at home and across the globe. U.S. LNG secures our democratic allies abroad with reliable, affordable energy, and protects the world from developing economies’ use of coal to power their energy needs, advancing America’s national security.
Myth: U.S. LNG causes spikes in domestic gas supply pricing.
Fact: Domestic natural gas prices have been stable despite rapid growth in the U.S. LNG export volume. Henry Hub prices, a key trading point for the market in the Gulf of Mexico, have largely remained stable and only see real spikes during extreme weather events, the invasion of Ukraine, and demand growth after COVID. Natural gas supplies in the United States remain abundant and affordable, and we must continue to build out infrastructure to move energy where and when it’s needed.
Myth: U.S. LNG is worse than coal.
Fact: An ICF research report found that without U.S. LNG exports, the world would have seen higher greenhouse gas emissions. The report, “Lifecycle GHG Emissions of U.S. LNG Exports: Concepts, Methodologies, Data and Results,” shows that in 2022 greenhouse gas emissions (GHG) would have increased by over 112 million metric tons, over half from coal (54%), a third from oil (34%) and just 8% from renewables. Further, the report found shifting from U.S. LNG to coal increases GHG emissions by 47.7% to 85.9%. Shifting U.S. LNG to fuel oil increases emissions by 24.8% to 41.8%. Additionally, the ICF report compares its results to other limited studies, including one by Robert Howarth cited in media reports as the basis for the Biden Administration’s “LNG pause.” The Howarth study applies a methane emission factor 2-3x more than congressional approved levels. In the absence of US natural gas – the world sees higher emissions and negatively impacts climate change.
Myth: Delaying U.S. LNG export projects will not have a significant impact on global emissions.
Fact: Coal use and emissions from power generation in Asia will surge in coming decades unless there is significant new supply of U.S. LNG. The study just released by Wood Mackenzie and commissioned by the Asia Natural Gas & Energy Association (ANGEA), models energy demand, power generation and the implications for gas demand for nations across Asia through to 2050. The study found continued growth in LNG production from the US – the world’s biggest exporter – was essential to balancing global markets and providing emerging Asia with an affordable and available alternative to the high-emitting coal that is currently the region’s dominant electricity source.
Myth: Natural gas accelerates the impacts of climate change.
Fact: Converting coal plants to natural gas has been the single largest driver of the United States’ world leading emission reductions over the last two decades and can be replicated around the world where coal use is accelerating. The Energy Information Administration reports that since 2005, nearly two-thirds of all U.S. power sector emissions reductions have come from natural gas, with the remainder from carbon-free sources like wind, solar and hydro.
Myth: Natural gas pause only has a small regional impact to the U.S. Gulf States.
Fact: 900,000 jobs are at risk and the economic cost could exceed $216 billion as a result of the ongoing pause of U.S. LNG export approvals. According to a study released by the National Association of Manufacturers, the ongoing pause in LNG export licenses threatens economic stability as well as progress made by manufacturers in America, unnecessarily putting jobs and economic growth in jeopardy, while pushing other nations to use higher emissions alternatives. LNG exports are vital for U.S. economic growth, fostering job creation, incentivizing investments in production, and enhancing overall economic activity.
