Republicans argue that the pause on LNG export permits could harm the U.S. economy and undermine global energy security.
Concerns Raised by Republican Lawmakers
Republican lawmakers, including Cathy McMorris Rodgers, Bill Johnson, Steve Scalise, and Elise Stefanik, have sent a letter to President Joe Biden expressing their opposition to the pause on liquefied natural gas (LNG) export permits. They argue that pausing the permits could have detrimental consequences for the U.S. economy and global energy security.
In their letter, the lawmakers highlight the positive economic benefits and enhanced energy security that U.S. LNG exports provide. They stress the need for the Biden administration to encourage the production of clean-burning and reliable natural gas and to grant export permits to access global markets.
The lawmakers point out that more than 87% of U.S. LNG exports went to Europe, the United Kingdom, or Asian markets in December 2023. They emphasize the importance of LNG exports in helping American allies reduce their reliance on Russian energy, especially after Russia’s invasion of Ukraine in 2022.
Potential Impact on Energy Prices and U.S. Economy
McMorris Rodgers, Johnson, Scalise, Stefanik, and other Republicans warn that pausing LNG export growth could lead to increased U.S. energy prices and harm the U.S. economy. They cite research indicating that LNG exports could contribute up to $73 billion to the U.S. economy by 2040, create hundreds of thousands of American jobs, and increase U.S. purchasing power by $30 billion.
The lawmakers argue that actions that slow or halt LNG exports would weaken global energy security and put strategic markets at risk. They urge the Biden administration to consider the potential ramifications of the pause on LNG export permits.
Proposed Legislation and Hearings
Republican lawmakers are taking further action to address their concerns. Senate Banking Committee Ranking Member Tim Scott is leading a group of 16 senators in introducing the Unlocking Domestic LNG Potential Act, which aims to transfer approval decisions for LNG export projects from the Department of Energy (DOE) to the independent Federal Energy Regulatory Commission (FERC).
The Energy and Commerce Committee Republicans are also planning to hold a hearing to examine the potential consequences of the pause on LNG export permits.
Details on the Pause and Project Impact
Last month, President Biden ordered a pause on pending permits for LNG export facilities to conduct an environmental review of the projects’ carbon emissions. The pause could take over a year to complete and has been seen as a significant win for activists concerned about climate change.
The pause will impact projects that are in the DOE’s approval process and have undergone a lengthy review. It is unclear which specific projects will be affected, but at least two have larger capacities and two have smaller capacities.
According to federal data, there are 11 approved projects not yet under construction, four projects pending before FERC, and two projects in the pre-filing stage. The pause will affect projects in the DOE’s approval process but will not impact those awaiting FERC approval.
The White House has not yet responded to the Republicans’ letter.