Biden bucks Obama’s legacy on climate and gas with LNG export pause

by Saul Elbein - 01/27/24 5:00 PM ET

The Biden administration and Democrats are pushing back against a years-long trend in energy policy that was set in motion by their own former leader.

In tandem with actions aimed at protecting the climate, former President Obama pursued an aggressive policy of natural gas exports — one which President Biden continued for most of his first term.

Early Friday morning, however, Biden — under heavy pressure from many in his own party — signaled a step back, announcing a pause on permits for the segment of the vast fleet of new gas export terminals still awaiting federal permission to build.

During that pause, the president wrote, the administration will “take a hard look at the impacts of [liquified natural gas, or LNG] exports on energy costs, America’s energy security, and our environment.”

Environmentalists, congressional Democrats and communities in the shadow of the export terminals have pushed Biden on the issue, fearing that the gas terminals will fuel an enormous boom in the burning of the planet-heating chemical and undercut renewables, potentially hamstringing attempts to slow climate change.

President Biden walks with former President Obama on Saturday, Nov. 5, 2022, in Philadelphia during a midterms campaign rally. (AP Photo/Matt Rourke)

The gas industry contends that because the fuel burns cleaner than coal, the expansion of U.S. gas exports will help the world at large cut emissions — and their restriction will hand the initiative to less responsible actors.

Critics, however, have pointed to findings that even relatively small amounts of leakage from natural gas pipelines can make the fuel as damaging to the climate as coal — findings the industry disputes.

The Biden administration’s decision to implement the pause and review LNG exports’ impacts marks an elevation of critics’ concerns. It also represents a sea change from Obama’s tenure, when the White House didn’t see the themes of climate action and gas boosterism as contradictory, and when the current boom in U.S. gas exports began.

Back then, the White House embraced the idea that gas could be a “bridge fuel” connecting a largely coal-based U.S. power system to a glittering future of renewables — and that U.S. exports of fracked gas could do the same thing for the world at large.

Obama took office amid an epochal boom in U.S. oil and gas that he had inherited from former President George W. Bush. Starting in the second half of the Bush administration, surging gas prices — which spiked sixfold between 2002 and 2005 — helped fund revolutionary new drilling methods that fueled a gas boom.

These shifts had a dramatic effects on the formerly placid world of U.S. gas, which had been largely flat for decades. In 2005 — the year prices spiked — the nation produced about as much gas as it had in 1967.

That changed quickly. By 2008, when Obama took office, gas production had edged up to 13 percent over where it had been in 2005. By the time he left, it was 50 percent higher — and for the first time in history, the United States had a gas export industry.

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Obama’s team had been bullish on gas since the beginning — with presidential advisor Rahm Emanuel touting increased production on the campaign trail in 2008 as a way to bring “real energy independence” to America.

This independence could be costly for those who lived near the well sites — which sometimes showed up on people’s property whether they wanted them or not. In late 2011, toward the end of Obama’s first term, the Environmental Protection Agency confirmed what people living amongst Barnett and Marcellus Shales had warned of for years: that fracking fouled local water supplies, and over the following decade, numerous studies would also confirm fears over its health impacts.

But Obama told Americans that there was no contradiction between a focus on gas and care for the climate.

In his 2014 State of the Union, he attributed U.S. climate progress to natural gas, saying if “extracted safely” it represented a “bridge fuel that can power our economy with less of the carbon pollution that causes climate change.”

Obama’s reasoning centered on harm reduction. Gas is mostly methane, a fossil fuel that releases only about half the quantity of planet-warming chemicals when burned as coal — as well as far fewer pernicious atmospheric contaminants like sulfur dioxide.

And as gas supplies surged, slashing the fuel’s price, something unprecedented happened: By 2016, gas had replaced coal as the dominant fuel in the American electric sector — by far the most planet-warming part of the economy of the country that has historically contributed more to climate change than any other.

In this way, the gas boom contributed to Obama administration efforts to clean up emissions from the power sector and shift away from coal.

It also sparked the increasing outflow of gas exports and the policies supporting them that Democrats are now grappling with.

The oil and gas industry turned to foreign markets, where gas prices were markedly higher than in the U.S., after being dealt a blow by the same factors that fueled the boom: the crash in domestic prices and the new drilling methods, which were costly.

To reach those markets, they needed the Obama administration’s help — for decades, federal law has required any gas exports to countries that aren’t free-trade partners of the United States to be approved by the Department of Energy.

Industry got the help it needed: The Obama Energy Department approved the U.S.’s first gas export terminals beginning in 2011, and released a 2012 study finding that such terminals were in the public interest — approving new terminals along the coasts of Georgia, Louisiana and Texas.

Then, in December 2015, the same month that Obama signed the pivotal Paris climate accords, Congress legalized oil exports for the first time since the Arab oil crisis in the 1970s, with the administration’s strong support.

The first ship carrying a cargo of liquified natural gas left the U.S. just two months later.

Few in the environmental community understood the full magnitude of this shift at the time, political analyst Jeremy Symons told The Hill.

“Even as we opposed the gas boom, we really did not conceive of the scale at which fossil fuel exports were going to surge to the point that it was transforming global energy flows and putting climate goals out of reach,” he said.

That gas buildout continued full steam during the subsequent administrations.

The Trump administration went full speed ahead with expanding exports even as it moved to dismantle many of the Obama administration’s other climate and energy policies — pulling the United States out of the Paris climate accords and ending the Clean Power Plant Rule, which had itself relied on gas.

Amid a continuing flurry of new export terminal approvals, federal agencies deemed gas exports in 2018 to always be an economic good and in 2019 to always be an environmental good.

Then, in 2020, the Trump administration further liberalized gas export permitting so that a terminal granted a license to ship gas could do so until 2050.

And the expansion has continued under Biden. With U.S. gas production another 40 percent above where it had been when Obama began approving terminals, the Biden Department of Energy approved a til-2050 permit for a plant approved by Obama, a controversial Alaska LNG project and an expansion to the Cameron LNG plant.

The Biden administration has previously defended its support for gas exports using similar logic as Obama — saying they represent a benefit to the climate because gas is better than other fossil fuels.

Once Russian troops rolled through Ukraine, sowing chaos through world energy markets, the administration also concurred with gas export companies that a new fleet of export terminals — beyond those already approved — was essential to support European allies in the proxy war with Russia.

In the past year, however, the president has begun to feel the heat from the party’s young base, the manufacturing sector and terminal-adjacent communities in Texas and Louisiana — and the congressional Democrats and European lawmakers who have amplified the communities’ criticisms.

Now, with the pause on LNG export approvals and accompanying review, Biden has made a shift away from the federal support for the buildout that began with Obama and delivered at least a partial victory to those critics.

On Friday, the president announced his administration would take “a hard look” at the dozens of projects still in planning, evaluating their “impacts of LNG exports on energy costs, America’s energy security, and our environment. This pause on new LNG approvals sees the climate crisis for what it is: the existential threat of our time.”

In response, the gas industry has accused the president of acting on political motives and letting down the country’s allies.

“There is no review needed to understand the clear benefits of the U.S. LNG for stabilizing global energy markets, supporting thousands of American jobs and reducing emissions around the world by transitioning countries toward cleaner fuels,” Mike Sommers of the American Petroleum Institute said in a statement.

“This is nothing more than a broken promise to U.S. allies, and it’s time for the administration to stop playing politics with global energy security,” he said.

Republicans also attacked the pause, with House Energy and Commerce Chair Cathy McMorris Rodgers (R-Wash) accusing Biden of “prioritizing the wishes of radical activists over U.S. energy security and the security of our allies.”

“This is another gift to Putin,” she said.

Some environmentalists and progressives, on the other hand, have pushed the administration to go still further and institute a more permanent block.

That’s because the Biden administration’s move doesn’t shut off the spigot of American gas exports from facilities permitted under Obama or Trump, or even the future exports from the facilities the current administration itself has permitted — all of which (as a coalition of left-leaning European lawmakers wrote to Biden this week) far outstrip the needs of the European Union, and will largely be sold to global middlemen.

The environmental movement, said Tyson Slocum of Public Citizen’s energy program, wants to a have “a commonsense factual analysis” of the legacy and future of the gas boom. “And that’s the debate that we relish to have, because the facts are on our side,” he said.

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