U.S. Stalls Gas Export Projects That Activists Say Are ‘climate Bombs’

The Washington Post / Maxine Joselow, Evan Halper

15:06 JST, January 28, 2024

President Biden weighed in decisively in favor of climate activists fighting new fossil fuel development on Friday, deciding to pause the approval of new liquefied natural gas projects because of their danger to the planet, even in the face of criticism that the delay could hurt U.S. energy businesses.

The presidential directive, which requires the Energy Department to study the climate impact of new gas exports, could delay the approval of nearly a dozen fossil fuel projects past the November election. That could help Biden court young voters who consider such facilities to be “climate bombs” and who were angered by the administration’s approval of a massive drilling project in Alaska. But it risks antagonizing other interests, including foreign allies, fossil fuel companies and Republican lawmakers.

Many liquefied natural gas, or LNG, export facilities are in communities of color on the Gulf Coast and other parts of the country. Biden said in a statement that the climate review came in response to pleas from young activists and members of these communities.

“While MAGA Republicans willfully deny the urgency of the climate crisis, condemning the American people to a dangerous future, my Administration will not be complacent,” he said. “We will not cede to special interests. We will heed the calls of young people and frontline communities who are using their voices to demand action from those with the power to act.”

The decision represents the latest difficult choice Biden has faced over high-profile parts of his agenda. During early deliberations, it sparked a heated internal debate within the administration over national security concerns, according to two people familiar with the matter who spoke on the condition of anonymity because they were not authorized to comment publicly.

Biden’s top climate aides, including White House National Climate Adviser Ali Zaidi and clean energy senior adviser John Podesta, advocated for considering the climate consequences of gas exports, the two people said. But early on, top national security officials, including senior energy adviser Amos Hochstein and Secretary of State Antony Blinken, voiced concerns about curtailing gas exports to European allies in the event of another geopolitical conflict such as Russia’s invasion of Ukraine.

In the end, the national security officials were satisfied with the final decision, since the United States will continue to supply gas to Europe, even with the climate review, the people said.

“As our exports increase, we must review export applications using the most comprehensive, up-to-date analysis of the economic, environmental and national security considerations,” Energy Secretary Jennifer Granholm told reporters on a Thursday call previewing the announcement, adding that her department could make exceptions due to national security emergencies.

Zaidi told reporters on the call that “the United States has been an unwavering partner to our allies in Europe, who, by the way … are our partner in calling for a transition away from fossil fuels.”

The New York Times first reported the administration’s decision, after Politico reported the White House was considering a climate review of LNG exports. Hochstein and a State Department spokesman did not respond to requests for comment.

The United States is already a powerhouse in energy production, with its LNG exports playing a crucial role in helping Europe break free of its reliance on Russian gas. The question of approving additional gas exports has enormous environmental and political stakes: Allowing these facilities could lock in dependence on fossil fuels for decades to come, while pausing them could cede a future market to rivals and raise anxieties about global energy security.

Former president Donald Trump, the front-runner for the GOP presidential nomination, said the decision would undermine America’s energy and national security. “Joe Biden has once again caved to the radical demands of the environmental extremists in his administration,” Trump campaign spokeswoman Karoline Leavitt said in a statement.

Halting the expansion of LNG exports has become a top priority of environmentalists in recent months. Before news of the administration’s decision broke, several environmental groups had been planning a “Stop LNG” sit-in outside the Energy Department in early February.

The author and climate activist Bill McKibben, who had been preparing to attend the sit-in, this week declared victory. “It’s pretty clearly the win,” he wrote in a text message to The Washington Post.

The administration’s decision has cast uncertainty over a mammoth LNG project on the Louisiana coast known as Calcasieu Pass 2, or CP2. The project is closer to becoming operational than nine other proposed LNG terminals, since it has already secured financing and customers and is awaiting federal permits.

Shaylyn Hynes, a spokeswoman for the project’s owner, Venture Global, said in an email that “it appears the administration may be putting a moratorium on the entire U.S. LNG industry. Such an action would shock the global energy market, having the impact of an economic sanction, and send a devastating signal to our allies that they can no longer rely on the United States.”

Germany last year signed a deal to purchase about 2.21 million metric tons a year of LNG for 20 years from CP2. Stephan Gabriel Haufe, a spokesman for the German Federal Ministry for Economic Affairs and Climate Action, declined to comment on the Biden administration’s decision. But he said in an email that in general, “the German government has taken numerous measures to ensure security of supply, so we are currently not seeing any effects here.”

In a letter this week to the Biden administration, a coalition of fossil fuel industry groups blasted the decision as misguided. The groups, including the American Petroleum Institute and the Independent Petroleum Association of America, argued that limiting U.S. LNG exports would increase global emissions, since the gas could replace coal, the dirtiest fossil fuel.

“One of the biggest things we can do for the environment is to send more U.S. LNG overseas to displace coal,” Mike Sommers, president and chief executive of the American Petroleum Institute, told reporters at an event in Washington this month. The institute used the event to launch an eight-figure ad campaign promoting fossil fuels as “vital” to energy security.

Republicans on Capitol Hill also slammed the climate review. Senate Minority Leader Mitch McConnell (R-Ky.) said on the Senate floor Wednesday that “it is abundantly clear that our adversaries are not waiting for us to wake up from this experiment in green self-harm.” House Speaker Mike Johnson (R-La.) said in a Friday statement that stalling LNG terminals “not only prevents America’s economic growth, it empowers our adversaries like [Russian President] Vladimir Putin.”

Yet some analysts said pausing permit approvals would have little immediate impact on the flow of U.S. LNG exports to European allies. They said the move would not impede the eight LNG export projects currently operating, nor would it halt the 10 projects already approved and under construction.

“This is an issue about not the coming wave of LNG but a potential future wave of LNG,” said Ben Cahill, a senior fellow in the Energy Security and Climate Change Program at the Center for Strategic and International Studies.

The United States now ranks as the world’s biggest LNG exporter after doubling its exports over the past four years. The projects already approved and under construction are expected to again double the potential volume of U.S. LNG exports by 2028. Almost all of these projects are along the Gulf Coast, mostly in an industrial region straddling Louisiana and Texas that is already home to hulking petrochemical plants.

Biden enraged young climate activists last year by approving the Willow oil drilling project in Alaska, even as the White House argued it was legally obligated to sanction it. But the greenhouse gas emissions associated with CP2 would be 20 times as large as those from Willow, according to an analysis by Jeremy Symons, an environmental consultant and former climate policy adviser at the Environmental Protection Agency.

“The Willow project was a carbon bomb, but the CP2 project is a megabomb when it comes to climate change,” Symons told The Post in an interview last year.

Some analysts said they view the administration’s decision as an olive branch to young voters, whom polls show prioritize climate action more than older generations.

“The president lost a lot of support after the Willow decision, especially among young folks,” said Bob McNally, president of Rapidan Energy Group and an energy adviser in the George W. Bush administration. “I think the environmental community has put pressure on these projects and said, ‘Here’s where you can claw back some credibility on climate.’”

Two federal agencies are responsible for approving permits for LNG projects. The Federal Energy Regulatory Commission must decide whether to authorize the siting and construction of projects, and the Energy Department must determine whether it’s in the “public interest” to export gas to countries with which the United States lacks a free-trade agreement.

The Energy Department has never determined that gas exports are not in the “public interest.” In response, environmental activists have pressured the department to overhaul its approach to better account for climate impacts.

Activists note that the main component of natural gas is methane, a powerful greenhouse gas that traps more heat in the atmosphere than carbon dioxide in the short term. They also warn that new LNG export terminals will be operational for decades, even as top climate scientists say humanity must rapidly phase out fossil fuels to avert catastrophic warming.

“Liquefied natural gas is an incredibly dirty fuel, and the scale of exports that the U.S. has built up over the last few years has enormous global climate implications,” said Abigail Dillen, president of the environmental law firm Earthjustice. “The fact that the president is taking it on is huge, and I think it is going to mobilize his climate base in an election year.”