Over the last ten years, the United States has become the largest exporter of liquefied natural gas (LNG) worldwide. The fracking boom has enabled gas companies to build seven massive export terminals along the Gulf Coast, which has allowed them to sell fracked natural gas overseas. These terminals condense natural gas into a dense liquid that can be loaded onto tanker ships and transported globally.
The LNG industry is set for rapid expansion, as there are several export projects awaiting approval from the Department of Energy under President Biden’s administration, with more in the pipeline. If approved, these facilities could almost double the nation’s export capacity by the end of the decade. The decision to approve this surge in exports has become one of the biggest climate issues President Biden faces.
In a recent announcement, the Department of Energy stated that it would temporarily pause approvals for new LNG exports while it reviews how it regulates them. During this period, the administration will focus on examining the potential climate impacts of exporting natural gas, suspending approvals in the meantime.
This decision has been welcomed by environmental activists and local residents. However, the outcome of the pause on export approvals is uncertain. One of the key debates is the impact of exporting LNG on the world’s carbon budget. While natural gas is a fossil fuel and contributes to climate change, its use can also potentially replace more carbon-intensive energy sources like coal.
The determining the total climate impacts of exporting LNG is a complex issue. One of the major concerns is to weigh the import of U.S. LNG against other countries’ energy situation. Therefore, the Biden administration will need to carefully consider the role of U.S. LNG in each country’s energy transition.
Given the expectation of falling European gas demand and increased investment in renewable energy, Europe’s need for more U.S. gas is being called into question. Some say that more LNG exports may lead to increased emissions, while gas industry groups stress that U.S. LNG is crucial for global energy security.
