Biden pulls the plug on future LNG terminals
FacebookTwitterEmailMessageBy Hoppy Kercheval
January 29, 2024 - 12:03 am
In March 2022, President Biden promised the United States would be a reliable supplier of natural gas to European countries to replace the flow from Russia. The landmark energy supply deal with the EU guaranteed shipments of liquified natural gas (LNG) to keep homes heated and businesses running, but with a side benefit of punishing Russia for its invasion of Ukraine.
Europe rapidly added new facilities to receive the gas while the handful of U.S. LNG ports ran full bore. Companies planned additional export terminals to meet the increased demand. In 2023, the U.S. became the world’s leader in LNG exports.
However, last Friday the Biden administration announced a freeze in the approval process for the new terminals citing environmental concerns. “This pause on new LNG approvals sees the climate crisis for what it is: the existential threat of our time,” Biden said.
That decision puts 17 proposed LNG export plants on hold for the short term and in limbo for the medium and long term. What changed from 2022 to now?
Biden’s re-election campaign is foundering, and he is scrambling to cobble together the varied constituency groups that helped him beat Donald Trump in 2020. One of those is left-leaning voters, many of them young Democrats, who want Biden to be more proactive on environmental issues.
This checks that box. Barry Rabe, a professor of public policy at the University of Michigan, told the Wall Street Journal that this move will help him with young voters. “Especially in a close election, every variable is potentially relevant, including turnout.”
So, politically it makes sense to try to shore up that group. However, what about the practical aspects of Biden’s decision?
European allies who received assurances from the President in 2022 for natural gas supplies now must wonder about those guarantees, especially if the war in Ukraine drags on. The demand for energy is not going to wane and alternative sources are not coming online fast enough to make up for any shortfall. These countries will have to find other supplies or return to a greater reliance on coal, which generates more greenhouse gases than natural gas.
That means the Biden slow roll of new LNG export terminals will have no effect on climate change. It will, however, depress what has become, in just a few short years, a significant economic driver in this country.
West Virginia is part of that. Hydraulic fracturing technology is tapping into nearly unlimited supplies of gas. Much of it is used domestically, but a significant portion is pipelined to the east coast or the gulf coast to be exported.
Charlie Burd, executive director of GO-WV, a natural gas and oil trade organization in the state, said, “LNG is an essential resource that supports America’s fundamental goals of improving the environment, increasing energy access and supporting job and economic growth at home.”
“Any attempt to limit this development or trade with allies across the globe would put American energy and national security at risk while destroying the jobs, economic progress and climate benefits West Virginia natural gas provides,” Burd said.
As recently as 2016, the United States did not export any LNG. In a few short years this country has become a world leader in the production and exportation of a clean, reliable fuel that is much in demand around the world.
And now President Biden has unilaterally halted the growth of the LNG export market in a desperate attempt to shore up a few voters, all-the-while leaving our European allies to wonder about the true measure of our promises.
