Updated Jan 26, 2024 - Energy & Environment

Biden eyes "pause" of new LNG export facilities

Illustration of two liquefied natural gas tankers creating a pause symbol

Illustration: Natalie Peeples/Axios

The Biden administration will pause approvals of new liquefied natural gas export facilities, partly to more fully consider each project's potential climate change consequences, President Biden announced Friday morning.

Why it matters: The U.S. is the top LNG exporter in the world. A moratorium affects the fate of facilities that do not yet have a permit from the Energy Department, and would come online later this decade.

The intrigue: Entering the general election, President Biden is facing an uphill climb to win over more young voters who care about climate change and the situation in Gaza.

  • Climate activists have identified the expansion of LNG facilities along the Gulf Coast as the next big battle in the fight against global warming. They view their approval as incompatible with U.S. climate commitments.
  • Opponents of the plants also include fence-line communities in Louisiana, worried about the local environmental impacts of new hubs built along eroding shorelines.
  • In a statement Friday morning, Biden characterized the pause as part of his administration's climate agenda: "This pause on new LNG approvals sees the climate crisis for what it is: the existential threat of our time."

The other side: The oil and gas industry has argued a pause in approvals could increase coal consumption in some countries, and benefit other producers of natural gas around the world.

  • The Trump campaign in a statement Friday blasted the move, calling it "one more disastrous self-inflicted wound that will further undermine America's economic and national security."

Of note: LNG is a cleaner-burning fuel than coal, which in many cases it has replaced. Still, it emits methane when burned and elsewhere in the supply chain.

Reality check: The U.S. is still poised to continue to significantly grow its production and export capacity, since the pause does not affect current exports, or previously permitted facilities that have begun construction.

  • In fact, American LNG export capacity has tripled since 2018, and is slated to double further by 2030 even with the pause, Energy Secretary Jennifer Granholm told reporters on a press call Thursday evening.
  • The new decision affects facilities along the Gulf Coast that, if approved, would begin operation later this decade, like Venture Global LNG Inc.'s CP2 export terminal in Louisiana.
  • LNG export terminals need approval from both the Federal Energy Regulatory Commission (FERC) and DOE.

Between the lines: According to Granholm, DOE has long considered global greenhouse gas emissions to be a factor in its permit evaluations.

  • However, American production and exports have grown dramatically in recent years, including in response to national security concerns in the wake of Russia's invasion of Ukraine. More updated climate goals now need to be reflected in how these analyses are conducted, she said.
  • At COP28, for example, the Biden administration signed on to the global agreement recognizing that countries are now on course to "transition away from fossil fuels in energy systems."
  • White House climate advisor Ali Zaidi told reporters that evolving science about methane's global warming contribution also needs to be included in LNG export terminal approvals.
  • He noted methane "perhaps represents up to half a degree of the warming that's already been witnessed around the world."

Yes, but: The pause will have an exception that can be made for national security reasons, the administration said.

What's next: Granholm said DOE's national laboratories will work to improve the department's LNG project evaluations, and that there will be a public comment period.

  • The pause has no strict deadline, and is not considered a federal rule. Still, officials told reporters Thursday evening that it is likely to last a number of months.
  • Meanwhile, the export pause is sure to be a significant campaign issue, with Democrats emphasizing the Biden administration's climate record and Republicans calling for expanded domestic energy production.

Editor's note: This story has been updated with additional comment.

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