House Republicans will move forward this week with legislation to expedite exports of American natural gas, which supporters argue will help Europe and Ukraine break their dependence on Russian fuel and cut Moscow’s influence in the region.
The move comes as the Obama administration sharpens its rhetoric on the issue after initially dismissing liquefied natural gas exports as a meaningful, immediate response to Russian military aggression in Ukraine.
While administration officials still argue — and most analysts agree — that U.S. natural gas shipments wouldn’t reshape global energy markets in the short term, they’re expressing more support for a long-term strategy to give Ukraine, Germany and other nations the choice of buying American fuel rather than gas from Russia.
Russia supplies more than half of Ukraine’s natural gas and about 30 percent of Europe’s supply as a whole, complicating efforts to impose economic sanctions or other punishments for Moscow’s actions in Ukraine.
“If those countries have a choice in their supplies, they can use that market power to reinforce their independence and break the ability of individual suppliers to use energy as a tool that affects the political choices they want to make for the future,” said Carlos Pascual, the State Department’s special envoy and coordinator for international energy affairs, during a speech at the Atlantic Council last week.
As the crisis in Ukraine intensified last month, the White House played down the importance of U.S. natural gas — now in abundance thanks to the exploding use of fracking and the discovery of huge natural gas deposits such as the Marcellus Shale — as a weapon against Moscow.
Since then, however, there have been signs the idea is gaining traction. Late last month, the Energy Department approved a liquefied natural gas export project in Oregon, the seventh such project to be green-lighted by the Obama administration. Nearly two dozen such projects remain under review.
Also last month, the U.S. and European Union released a joint statement stressing that “the situation in Ukraine proves the need to reinforce energy security in Europe and we are considering new collaborative efforts to achieve this goal.” The statement went on to say that the prospect of U.S. liquefied natural gas exports would be “welcome” in the future “since additional global supplies will benefit Europe and other strategic partners.”
But that’s still not enough for House Republicans, who argue the administration should have immediately approved all pending liquefied natural gas export applications to send a strong signal to Moscow that the days of Russian dominance in European energy markets are coming to an end.
The Republicans quickly drafted new legislation — the “Domestic Prosperity and Global Freedom Act” — that would grant immediate approval to all proposed projects and make it easier for new facilities to be approved in the future.
The House Energy and Commerce Committee will vote on the bill Tuesday.
“Our allies around the world are clamoring for natural gas, a resource that is abundant here in the United States,” said Rep. Cory Gardner, Colorado Republican and author of the bill. The bill, he said, “will help our allies lessen their energy dependence on hostile nations while growing our economy here at home.”
But some analysts urge caution and say the administration could do more harm than good by, for example, cutting coal consumption at home while shipping natural gas abroad.
Steps by the Environmental Protection Agency to curb carbon emissions are likely to result in the closure of coal-fired power plants across the country, opening the door for natural gas as a replacement.
A massive increase in natural gas use here at home, coupled with shipments to Europe and elsewhere, could lead to shortages in supply or higher prices, said Dan Kish, senior vice president for policy at the conservative Institute for Energy Research.
“Nothing the administration does on energy is done in a vacuum,” he said. “I would be very careful about putting all your eggs in that basket because the truth of the matter is, everything the administration is doing about energy is making it worse in the upcoming years. There’s no reason to believe — unless they change their policies on shutting down sources of energy here at home and making it harder to produce energy at home — there’s no guarantee that the stuff will be there when people need it.”