🔒U.S. Sen. King seeks to curb rapid expansion of LNG exports

U.S. Sen. Angus King, I-Maine, has joined 11 Democratic senators in calling on the U.S. Department of Energy to put the brakes on expanding liquefied natural gas exports.

In their Sept. 21 letter to DOE Secretary Ernest Moniz, King and his Senate colleagues reiterated their misgivings about the Energy Department's accelerating approval of LNG exports to other countries, asserting that continuing to do so will “disproportionally harm domestic industries like the agricultural, electricity and paper, pulp and primary metal manufacturing sectors that will suffer from higher natural gas and electricity prices.”

“We ask that the DOE slow its approval process until the full impacts of currently approved exports are realized,” the senators stated in their letter. “In total more than 60% of 2015 natural gas production has been approved for export, but only a small fraction of that has actually been exported to date. We believe it would be prudent for the DOE to first evaluate the impacts of approved projects, especially as new export terminals come online, before approving additional LNG exports.”

In a statement accompanying the letter, King brought the issue home to Maine by making two points:

• Increasing exports of LNG to foreign countries is counter-productive when more natural gas “is desperately needed in Maine and across New England to help lower energy prices.”

• The United States “would be giving away one of its sole economic advantages to international competitors when it could benefit the country.”

The first of King's concerns is tied to the increasing role that natural gas plays in the generation of New England's electricity. According to ISO-New England, the nonprofit corporation responsible for keeping electricity flowing across the six New England states, 48.5% of the region's electricity is generated at natural gas-fired power plants. In 2000, natural gas fueled just 15% of the region's electricity.

Natural gas's role in electricity costs

ISO-New England projects that the importance of natural gas as a fuel source for electricity generation will continue to grow, in part due to the closures of older and more costly oil- and coal-power and nuclear power plants as well as the region's relative proximity to the natural gas supply from the Marcellus Shale in Pennsylvania and New York. Nearly 60% of all new proposed power plant construction as of August 2016 will rely on natural gas, according to ISO-New England.

But there's a hitch, as ISO-New England states in its primer: “The region hasn't added natural gas pipeline capacity, despite the tremendous growth in natural-gas-fired generating capacity, coupled with growing demand from the heating sector. The result is that existing pipelines are now running at or near maximum capacity at times, particularly in winter. During these times, gas-fired resources may have to pay high prices for fuel — if fuel is available at all.”

ISO-New England's primer also gives some credence to the concerns expressed by King and the other senators about expanding LNG exports, stating “international LNG deliveries into New England are variable, and because it is traded globally, pricing varies and can be expensive.”

King, a member of the Senate Energy and Natural Resources Committee, also has introduced two pieces of legislation to ensure the U.S. doesn't increase LNG exports at the expense of Maine consumers and industries:

• The Domestic Energy Security Protection Act, which would cap the amount of natural gas exported from the U.S. to help preserve the country's advantage in the market and ensure adequate supply is available domestically.

• The Regional Gas Consumer Protection Act, which would require the Federal Energy Regulatory Commission to consider regional markets and evaluate benefits to regional consumers when it reviews any proposal to export natural gas.