The Trump administration claims to be making significant headway in swaying Germany to import more U.S. natural gas, using the country’s recent plans to close all its coal plants by 2038 as leverage.
“In order to meet that goal, they have to replace it with something else, and that something else is going to be natural gas,” Deputy Energy Secretary Dan Brouillette told the Washington Examiner.
Around 40 percent of Germany’s energy comes from coal, making it one of the biggest users of the fossil fuel in the European Union. Coincidentally, the country is the largest importer of U.S. coal in Europe, even though it imported 19 percent less coal last year than it did in 2017.
Brouillette had just returned from talks with German government officials in Berlin and on the sidelines of the Munich Security Conference last week.
He has been traveling most of the year promoting the administration’s ‘energy dominance’ agenda along with Energy Secretary Rick Perry and has made significant headway in the administration’s push to sway the European Union to reduce its dependence on Russian natural gas in favor of imports from the United States.
The U.S. became a net natural gas exporter in 2017 and has supplanted both Russia and Saudi Arabia to become the largest oil producer in the world.
But now with Germany’s decision last month to close all its coal plants in the next two decades, the administration sees the prospects for liquefied natural gas as even more favorable.
A major milestone in the U.S. talks with Germany came late last year when the country announced it was going to construct its first-ever liquefied natural gas import terminal on the Elbe River, close to Hamburg. German Chancellor Angela Merkel said the government will be co-financing the project with private industry.
Brouillette said the Germans are now looking at building more import facilities in addition to the one announced last fall.
Now the challenge for the Trump administration is meeting the increased demand for natural gas coming from Germany, he said.
“Obviously, we would like to fill those terminals with U.S. LNG, but the challenge we’ve had, candidly, over the last few years has been while our production numbers have gone up, our ability to get our product to market has been constrained by our own infrastructure,” Brouillette said.
But he remains confident that the U.S. is making headway in Washington, citing last week’s bipartisan decision at the Federal Energy Regulatory Commission to approval the first in a series of backlogged LNG export terminal applications.
FERC comprises four commissioners, two Democrats and two Republicans, with the chairman holding the same party affiliation as the president. The commission is the primary agency in charge of siting LNG terminals and conducting environmental reviews.
A sticking point in approving the LNG terminal was how to calculate its climate impact, but that problem was remedied with a 3-1 vote in favor of the projects.
With the commission one member short, the vote proved the key energy panel can get enough support to move ahead on these projects, sending an encouraging signal to investors and companies looking to build export terminals, Brouillette said.
The FERC action will “serve as a template for the approval of future facilities” and “is a very important step for America to meet the commitment we have made to our European partners and some of Asian partners to supply their needs for energy,” he said.
