Former Energy Secretary Dan Brouillette weighs in on the Biden administration’s pause on natural gas projects and the push for electric vehicles.
European Union energy officials are at odds with industry over the long-term effects of the Biden administration’s energy policy suspension. Liquefied natural gas (LNG) Implications for exports and European energy security.
The United States has become the biggest exporter of LNG to Europe, as EU countries rush to replace gas imports from Russia that have been halted following Russian oil and gas supply disruptions. invasion of ukraine More than 60% of U.S. LNG exports went to Europe in the past two years.
A European Commission spokesperson told Reuters that the suspension of U.S. LNG supplies would have “no short- to medium-term impact” on the EU’s gas supply security. This suspension affects the approval of new LNG export projects without affecting already approved permits.
But energy industry bodies have warned that the suspension could have a negative impact on Europe’s energy security in the future if gas supplies from LNG exports prove insufficient to meet demand. is ringing.
US, European and Japanese business groups push back against Biden’s LNG permit suspension
Europe has recently become the largest importer of U.S. liquefied natural gas (LNG) exports, with facilities like this one in Wilhelmshaven, Germany. (Photo credit: Stefan Rampfel/picture Alliance via Getty Images / Getty Images)
“The planned review could have a negative impact on Germany and Europe’s energy security in the future, for example through price increases due to lack of volumes on the market,” Germany’s largest gas trader Uniper said in a statement. .
Venture Global LNG’s Calcasieu Pass 2 plant, one of the LNG projects put on hold due to the moratorium, is scheduled to serve as an LNG source for SEFE, another German gas importer. Japan’s top LNG purchaser Jera.
The International Gas Union, which has more than 150 member countries, said the U.S. decision is “very worrying… (and) will have a negative impact on global energy security and emissions reductions.”
The United States will lead the world in liquefied natural gas (LNG) exports in 2023
The Biden administration has suspended approvals for new LNG export facilities. (Mark Felix/Bloomberg via Getty Images/Getty Images)
U.S.-based industry group LNG Allies called on the Biden administration to allow the market to decide which LNG projects go forward in the coming years. “Most energy forecasts project that global LNG demand growth will continue into the 2030s,” the group’s memo said. “If U.S. supply does not increase to match that demand, natural gas “Will these countries return to Russia? Or will they return to coal?” ”
Europe’s gas consumption is expected to decline in the long term as countries transition away from fossil fuels to meet climate goals, but strong demand growth in other parts of the world will sustain LNG markets It is expected that this will happen.
Anne-Sophie Corbeau, a researcher at Columbia University’s Center for Global Energy Policy, told Reuters that in the future, “the EU will be a region where gas consumption will decline.” “Between increases in biomethane, Norwegian gas, some African gas, and Azerbaijani gas, and lower production, we may end up with a gradual decline in LNG demand, especially after 2030. No. That’s exactly when Biden’s decision matters,” she added.
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The United States became the world’s largest exporter of LNG last year, and Europe and Japan became the largest importers of American gas. (Photographer: Kiyoshi Ota/Bloomberg via Getty Images/Getty Images)
of Biden administrationacting through the Department of Energy (DOE), has implemented a moratorium on new LNG export authorization applications to consider whether exports to non-Free Trade Agreement (FTA) countries are in the public interest. It is noteworthy that the European Union and Japan are non-FTA countries, despite long-standing and deep economic ties with the United States.
The move does not affect previously approved export applications, and the DOE currently has the capacity to export 14 billion cubic feet of LNG per day, with a total approved volume of 48 billion cubic feet. he pointed out.
Energy Secretary Jennifer Granholm said, “The administration is committed to ensuring affordable energy and economic opportunity for all Americans, energy security here in the United States and with our allies, and protecting Americans from climate change and providing clean energy.” We are committed to winning the future of energy.” A statement announcing the suspension of activities. “This practical action ensures that DOE continues to be a responsible actor using the latest economic and environmental analysis.”
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Last year, the United States surpassed Australia and Qatar to become the world’s largest LNG exporter, with Europe the biggest importer, followed by Asian countries. According to data from Japan’s Ministry of Finance, Japan will become the world’s second-largest LNG importer in 2023, with its share of imports from the United States increasing by 34% from the previous year. middle east Russia fell by 12% and 11%, respectively.
Reuters contributed to this report.
