If the United States were to continue exporting liquefied natural gas in the way that has made it the world’s biggest gas supplier, it would drive up costs for American consumers and businesses, pollute struggling communities and increase global greenhouse gas emissions, according to a letter written by Energy Secretary Jennifer Granholm that was obtained Monday by The Times.
The letter was written to accompany a study of the economic, national security and climate effects of approving new natural gas export terminals that was released Tuesday by the Energy Department.
President Biden ordered the analysis in January, when he paused the process of issuing permits for more than a dozen new gas export facilities, including what would be the largest terminal ever built in the United States. The pause was praised by environmentalists but triggered outrage from the oil and gas industry.
In the letter, Ms. Granholm said that the analysis showed that the continued pace of gas exports was “neither sustainable nor advisable.”
However, the report does not provide grounds for the federal government to issue blanket denials of the final permits for future natural gas terminals. Under federal law, two agencies are responsible for approving L.N.G. projects. The Federal Energy Regulatory Commission approves location and construction, while the Energy Department must determine if exports are “in the public interest.” To date, the Energy Department has never denied any company seeking such a permit.
The report could provide a legal argument for those seeking to sue to stop permits for export terminals in the future, the senior administration officials said.
In her letter, Ms. Granholm wrote that future administrations must scrutinize each proposed project and consider the economic and environmental issues raised by the analyses. The report may compel companies seeking permits to more thoroughly demonstrate that they have mitigated the greenhouse pollution associated with extracting and transporting the gas, and also force future administrations to show how they have reconciled decisions to approve new terminals with the report’s findings.
Ms. Granholm noted that U.S. exports of natural gas had tripled over the last five years, are expected to double by 2030 and could double again based only on new terminals that have already been approved and planned.
While she said that selling L.N.G. overseas generates “wealth for the owners of export facilities” and jobs across the supply chain, Ms. Granholm wrote that “unfettered exports” would mean less gas available at home, causing domestic wholesale prices to increase about 30 percent. That, in turn, would increase costs for the average American household by more than $100 a year by 2050 and quite likely also cause electricity prices to rise. For heavy industry, costs could go up by $125 billion, she said, citing the report. That in turn could lead to higher prices on goods for consumers, she wrote.
Since Russia invaded Ukraine in 2022, American L.N.G. “has proven critical for our allies in Europe as they wean themselves off Russian gas,” Ms. Granholm wrote. But she said the report found that European demand had flattened, peaked in Japan and was expected to flatten soon in South Korea. Most of the new demand will be in China, she wrote.