Biden’s Destructive Decision to Stymie Natural Gas

National Review Online

Tuesday, January 30, 2024

 

Rarely does a policy change make no sense on its own terms, contradict other policies of the same administration, and harm America’s domestic and foreign interests. But the Biden administration has managed to do all of that with its decision to stonewall approval of new liquefied-natural-gas export terminals.

 

The White House statement on the decision begins with a high-school-freshman opening sentence (“In every corner of the country and the world, people are suffering the devastating toll of climate change”), and the quality of analysis doesn’t improve from there.

 

Nowhere in the statement or the accompanying fact sheet does the administration explain the mechanism by which it believes the existence of new LNG export terminals would hurt the climate. The fact sheet mostly consists of a list of other climate-related policies the administration has pursued.

 

According to the EPA’s own methodology, which is more prone to overstate climate effects than other approaches, canceling all U.S. LNG exports forever would reduce global temperatures by 0.013°C by 2100. That tiny effect would be for a far more draconian policy than the Biden administration has pursued. LNG exports simply aren’t contributing to climate change in any significant way.

 

Here’s reality: LNG is going to be produced. It is going to be sold on the global market. It is going to be used. Those things will happen whether new export terminals are built or not. The question is whether the U.S. wants to make exports easier or harder.

 

Making it harder doesn’t help the climate. Countries that would have purchased U.S. LNG can substitute LNG from other countries. Mother Earth doesn’t really care which country it comes from.

 

Countries that aren’t able to substitute LNG from elsewhere are likely to use coal instead. Coal burns dirtier than LNG. The largest single reason for the decline in U.S. carbon emissions in the past several years is the switch from coal to natural gas for electricity generation. Making LNG exports more difficult hinders the ability of other countries to make that switch.

 

The U.S. did not export any natural gas until 2016. Now, the U.S. is the world’s top exporter. American LNG dominance is primarily a function of the fracking revolution. It is not only a manifestation of American innovation. It also presents a new tool for the U.S. in geopolitics.

 

Providing an alternative to Russian natural gas should be a primary objective of U.S. policy in Europe. The Biden administration likes to pride itself on restoring the confidence of U.S. allies, but our European allies are now concerned about the future if LNG export capacity won’t be expanded beyond projects that have already been approved.

 

The White House fact sheet says one reason the moratorium is needed is that current review processes do not “adequately account for considerations like potential energy cost increases for American consumers and manufacturers.” But the administration’s stances on other issues related to LNG demonstrate little care for costs.

 

If the Biden administration is really concerned about domestic natural-gas prices, it should urge the repeal of the Jones Act. Not one LNG tanker in the world currently meets Jones Act requirements, which makes it much more expensive to transport LNG domestically. The White House statement’s promise not to “cede to special interests” rings hollow considering the administration’s continued support for this special-interest-backed law.

 

And of course, the Biden administration is perfectly happy to listen to environmentalist special interests. The New York Times reported that this moratorium came after Biden advisers met with a 25-year-old TikTok influencer known for climate activism. It said activists used the same strategy they deployed against the Keystone XL pipeline during the Obama administration. The White House statement on the LNG decision said the administration would “heed the calls of young people” on climate issues.

 

The administration should also allow more pipeline construction if it wants to reduce costs. Instead, the Federal Energy Regulatory Commission has slowed down the approval of new pipeline projects since Biden took office. The insufficiency of domestic LNG transportation infrastructure (for Democrats, everything is infrastructure, except private infrastructure) means that regions such as the Northeast and the West Coast are often better off importing natural gas.

 

The U.S. already tried energy autarky with crude oil. Exports were prohibited from 1977 to 2015. Since repeal, U.S. crude-oil production has soared, and it currently sits at a record high. And U.S. dependence on oil from outside North America has declined: In most months in 2023, the U.S. imported more crude oil from Mexico than from all Persian Gulf countries combined.

 

An unnamed source in the Biden administration told Politico that the message of the policy change is, “Look, we can’t just keep building and building and building.” Whatever happened to Democrats’ enthusiasm for the expression “Yes, we can”?