Granholm Warns LNG Exports Could Drive Prices Higher

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Granholm Warns LNG Exports Could Drive Prices Higher \ Newslooks \ Washington DC \ Mary Sidiqi \ Evening Edition \ Energy Secretary Jennifer Granholm warned that unchecked liquefied natural gas (LNG) exports could raise U.S. prices and worsen global emissions. A recent DOE report highlights economic and environmental risks, strengthening the Biden administration’s pause on LNG approvals. Trump has vowed to overturn the pause, sparking a heated political and environmental debate.

LNG Export Controversy Quick Looks

Granholm’s Warning: LNG exports could increase domestic prices and emissions.
DOE Report Findings: LNG shipments drive up prices and displace renewables.
Biden’s LNG Pause: Aligned with environmental goals to cut climate pollution.
Trump’s Plan: Promises expedited approvals for LNG export projects.
Industry Pushback: Oil and gas groups criticize the Biden administration’s stance.
Environmental Impact: Concerns over habitat loss, emissions, and climate change.

Deep Look

Energy Secretary Jennifer Granholm has urged caution as U.S. officials evaluate the expansion of liquefied natural gas (LNG) export terminals. Her warning follows the release of a Department of Energy (DOE) study, which revealed that unchecked LNG exports could increase domestic energy costs and exacerbate climate change. This sets the stage for a high-stakes political and environmental showdown as the Trump administration prepares to lift restrictions on LNG projects.

DOE Report Highlights Economic and Environmental Risks

The DOE’s long-awaited analysis examined the economic and environmental consequences of increasing LNG exports, which have surged dramatically over the last decade. The findings were stark:

Rising Domestic Prices: LNG exports could drive up wholesale natural gas prices by over 30%, costing American households an estimated $100 annually by 2050.
Displacement of Renewables: Increased LNG shipments often displace cleaner energy sources, such as wind and solar power, on global markets.
Higher Global Emissions: Despite advancements in carbon capture technology, LNG exports contribute to higher greenhouse gas emissions worldwide.

Granholm emphasized the real-world implications of these findings, saying, “We have recently lived through the ripple effects of increased energy prices domestically and globally since the pandemic. An export-induced price increase would make it harder for some families to meet basic needs.” She underscored that the study reinforces why an unrestricted approach to LNG exports is neither “sustainable nor advisable.”

Biden’s LNG Pause and Industry Backlash

In January, the Biden administration enacted a temporary pause on approvals for new LNG export terminals, citing the need to assess their economic and environmental impact. This decision was met with fierce opposition from the oil and gas industry and Republican lawmakers, who argue the pause undermines U.S. energy dominance and economic growth.

The American Gas Association (AGA) called the report a deliberate attempt to justify what they see as a “grave policy error.” AGA President Karen Harbert stated, “America’s allies are suffering from the weaponization of natural gas, and any limitations on supplying life-essential energy is absolutely wrong-headed.”

Charlie Riedl, executive director of the pro-industry Center for LNG, argued that LNG exports provide essential economic and security benefits. He said U.S. shipments have helped reduce reliance on dirtier fuels like coal, particularly in Europe and Asia, where demand surged following Russia’s 2022 invasion of Ukraine.

Trump Vows to End LNG Pause

The Biden administration’s pause faces uncertainty as Trump, the presumed Republican nominee for the 2024 presidential election, has vowed to reverse the decision immediately. Trump recently declared that any investor making a $1 billion commitment in the U.S. “will receive fully expedited approvals and permits, including all environmental approvals.”

This promise reflects Trump’s broader stance on deregulating the energy sector and promoting fossil fuel exports to boost the economy. However, environmentalists see the move as a dangerous step backward.

Environmental Groups Respond

Environmental advocates hailed the DOE report as validation of their long-standing concerns. Raena Garcia, senior campaigner at Friends of the Earth, criticized Trump’s pro-LNG agenda, stating, “This study confirms that Trump’s plans to supercharge LNG exports will come at the expense of consumers and the climate.”

Lauren Parker, an attorney at the Center for Biological Diversity, emphasized LNG’s harmful environmental impacts. Parker warned that expanded LNG exports worsen climate change, harm wildlife, and increase costs for U.S. consumers. She cited the Rice’s whale, an endangered species in the Gulf of Mexico, as an example of how LNG-related offshore drilling threatens vulnerable habitats.

Exporting LNG is particularly energy-intensive. The gas must first be extracted through underground drilling, transported to export terminals on the East and Gulf Coasts, and “superchilled” into liquid form for shipment. It is then reheated into gas at import terminals overseas, consuming significant energy throughout the process.

Broader Political and Climate Implications

Biden’s pause on LNG projects reflects his administration’s commitment to achieving U.S. climate goals, including reducing greenhouse gas emissions by 50% by 2030. This aligns with mounting pressure from youth activists and frontline communities demanding urgent climate action.

In announcing the pause, Biden criticized Republicans for ignoring the climate crisis and prioritizing fossil fuel interests. He said his administration “heeds the calls of young people and frontline communities” who demand a sustainable energy future.

Conversely, industry supporters and Republican leaders argue that restricting LNG exports weakens America’s role as a global energy provider. They point to LNG’s role in reducing coal use and supporting allies facing energy shortages, particularly in Europe following geopolitical disruptions.

What Comes Next?

The Biden administration’s pause is under legal challenge, with the courts temporarily holding the measure. Meanwhile, the DOE has delayed decisions on two major LNG projects in Louisiana until environmental reviews by the independent Federal Energy Regulatory Commission (FERC) are complete.

The public comment period on the DOE report runs through mid-February, providing stakeholders an opportunity to weigh in. Pro-LNG groups are expected to challenge the findings, while environmentalists will leverage the report in anticipated legal battles against any Trump administration approvals.

With the 2024 election approaching, the future of U.S. LNG exports remains uncertain. The issue has become a flashpoint in the larger debate over climate policy, economic priorities, and America’s role in global energy markets.