The administration of U.S. President Joe Biden released a long-awaited study on the economic and environmental impacts of liquefied natural gas exports on Tuesday, saying the results underscored the need for a cautious approach to new permits.
Biden in January had paused the Department of Energy's approvals of U.S. LNG exports to big consumers in Asia and Europe so that his administration could conduct the review, triggering complaints from the oil and gas industry.
Incoming President Donald Trump, a climate-change skeptic and a big supporter of fossil fuel development, has promised to immediately end the moratorium on new LNG export permits when he returns to the White House on Jan. 20.
The study contained various scenarios of the impacts of LNG exports depending on domestic and international climate policies, technologies and resource availability.
Across all scenarios, the study found U.S. natural gas supply is sufficient to meet domestic demand for the fuel and global demand for U.S. LNG. But in an unconstrained LNG export scenario, domestic gas prices would rise 31% in 2050, it found, boosting natural gas bills for U.S. households by more than $100 a year with prices varying by region.
The study is meant to inform Energy Department decisions on new permits to export the gas. The department is required by law to determine whether exports are in the public interest.
Liquefied natural gas is natural gas that has been super-cooled to a liquid state, reducing its volume and allowing it to be transported to places pipelines do not reach.
When asked whether the results of the study would give LNG opponents legal grounds to challenge new LNG export permits in court, a DOE official, speaking on condition of anonymity, told reporters it should first be a consideration for any U.S. energy secretary. The official added that proponents of being cautious on LNG have a variety of recourses in Congress and in the courts, which the study could inform.
The study said while Europe has been the top destination for U.S. LNG since 2016, especially as the region weans itself off gas from Russia after its 2022 invasion of Ukraine, global demand and the destination of U.S. LNG in the future is less certain.
"European policies are moving to reduce the use of fossil fuels, including natural gas," the study said. "Demand for natural gas and LNG in Asia is expected to increase in most
scenarios."
LNG supporters said the U.S. study was influenced by politics in an election year.
A study by S&P Global also released on Tuesday said U.S. LNG has contributed more than $400 billion to U.S. GDP over the past decade, supporting about 273,000 jobs and will add about 495,000 jobs through 2040.
“LNG exports are not only in America’s national interest, but also in the world’s interest, including our European allies seeking to break free from dependence on Russian gas," the U.S. Chamber of Commerce said in a release about the Biden administration study.