LNG PROPONENTS RAISE SPECTER OF RUSSIA BENEFITING FROM PAUSE: The industry has opened up a new line of argument in its opposition to the Biden administration’s pause on approving LNG export terminals: that the pause will unfairly benefit Russia and contradict Western efforts to squeeze the Kremlin’s energy revenue.
For context: The U.S. has emerged in the past year to become the European Union’s largest LNG supplier as the bloc worked to make up for lost Russian gas, sent primarily via the now-exploded Nord Stream 1 pipeline.
The EU scrambled to find new supplies—even if that meant turning back to Russia. In fact, the bloc purchased record levels of Russian LNG between December 2022 and October 2023.
Why it matters: The U.S. has been a crucial ally in helping Europe offset that dependence, and sent more than 60% of its LNG to the bloc in 2023 alone. That’s expected to increase further with U.S export capacity on track to double before the end of the decade. But the Biden administration’s pause on new approvals has generated uncertainty about that calculus.
Biden officials have stressed repeatedly that DOE’s pause on approving new terminals is just that—a pause—that will allow it to consider the climate effects from the new LNG export terminals. Though it’s unclear how long the pause will take, it’s unlikely to be resolved before the November 2024 elections.
But opponents say that halting the approval of new LNG export terminals, even temporarily, could force the EU to take unattractive and emissions-heavy steps such as keeping existing coal plants online, purchasing more expensive LNG on the global spot market, and continuing to buy large amounts of Russian LNG.
Simon Watkins, an energy analyst and former longtime FX trader, argued in an op-ed that the U.S. pause on LNG export projects “is just what Russia wants.”
“The big fear here is not just that these pauses in permits for the big U.S. LNG projects will take months and maybe longer but also that some of them may not be allowed to go ahead at all,” one senior figure in the EU energy space told Watkins.
At the end of the day “it goes to whether or not our allies can trust us,” Christopher Guith, the senior vice president at the U.S. Chamber of Commerce’s Global Energy Institute, told the Washington Examiner in an interview.
President Joe Biden “committed directly to the president of the European Commission to move heaven and earth to bring additional supplies of U.S. gas there to displace their reliance on Russian gas,” Guith added.
“We must not forget that pausing the contracts or supplies kind of injects uncertainty [into] U.S. policies, because you don’t know when this might happen in the future again,” CSIS visiting fellow Kunro Irie said today at an LNG-focused event hosted by the think tank.
This view was echoed by others on the panel as well. While the EU response has been muted so far, any long-term uncertainty on LNG imports could be damaging. Leslie Palti-Guzman, a senior associate at CSIS’s Energy Security and Climate Change Program, said that the European Commission realizes this is a U.S. election year and “has not really reacted yet to this moratorium.” But there are still “many questions for the future” from a supply perspective, she added, especially given that Europe has invested millions in new infrastructure to deal with additional U.S. LNG capacity.
“I think [the EU] will need reassurance, they will need guarantees” from the U.S. before moving forward, she said.
The issue is also top-of-mind in Congress. The Republican-led House Energy and Commerce Committee announced today that it will hold a hearing next week to delve further into the administration’s decision to order a pause.
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment writers Breanne Deppisch (@breanne_dep) and Nancy Vu (@NancyVu99). Email bdeppisch@washingtonexaminer dot com or nancy.vu@washingtonexaminer dot com for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
FRENCH FARMER PROTEST CONTINUES AFTER GROUPS REJECT MACRON’S CONCESSIONS: French farmer protests over new EU environmental regulations stretched into a third day today as authorities struggled to head off the tractor blockades and convoys that blocked or limited traffic into Paris and attempted to encroach on the third-largest French city of Lyon.
The farmers said they were unhappy with concessions put forth by French President Emmanuel Macron, who had vowed to bring their concerns before European Commission leaders this week at a meeting in Brussels—including pressing for flexibility on a new regulation that would require farmers to set aside roughly 4% of their land for restoration purposes. Farmers in France have also been incensed by other domestic regulations, including a plan to reduce subsidies on agricultural diesel, which was later retracted.
Officials said an estimated 10,000 farmers were taking part in the road blockades, part of a protest against “anti-farming” policies enacted by the EU, which farming union leaders have argued will drive up costs of production and force business into other, less efficient parts of the world. Similar protests have played out in a growing list of EU countries, prompting fears that it could portend an upset of power in the coming European Parliament elections this fall.
BIDEN TO VISIT EAST PALESTINE A YEAR AFTER TRAIN DERAILMENT: Biden will travel to East Palestine, Ohio, next month, a year after the disastrous train derailment, our Naomi Lim reports.
Biden was widely criticized for traveling to Ukraine when residents of the village, near Ohio’s border with Pennsylvania, were forced to relocate after the Feb. 3 Norfolk Southern freight train derailment, in which some of the 38 cars, several of which were carrying hazardous materials, burned for days after the crash.
The White House today touted the response by a range of federal agencies to the disaster last year. It has not confirmed a date for Biden’s trip. Read more on that here.
CATTLE STRANDED DUE TO RED SEA CONFLICT: More than 16,000 sheep and cattle are stranded off the coast of Australia after authorities ordered an Israeli-owned ship moving the cargo to reverse course over fears of attacks from Houthi rebels in the Red Sea.
As CNN outlines, sweltering heat is adding pressure on the Australian government to make a decision on what to do with the animals.
Australia’s Department of Agriculture, Fisheries, and Forestry said on Wednesday that it would be considering a request from the exporter to offload some of the animals before re-exporting the remainder.
Animal welfare advocates, however, are arguing that the cattle should be offloaded as soon as possible. The animals have been on the ship since Jan. 5 – and 15 days into the journey, a request to reroute the ship’s course around Africa, due to fears of attacks from Houthi rebels, was rejected.
A reminder: Yemen’s Iran-backed Houthi rebels have been attacking commercial vessels they say are tied to Israel’s military efforts against Gaza.
EU LEADERS CAMPAIGN AGAINST PFAS BY TESTING THEIR OWN BLOOD: Top European leaders tested their blood for toxic chemicals as a part of a campaign advocating for a EU-wide ban, Bloomberg reports.
Former vice presidents of the European Commission, including Frans Timmermans, and the current environment commissioner Virginijus Sinkevičius tested their blood for per- and polyfluorinated chemicals, also known as PFAS or forever chemicals. The PFAS substances were found in all of the tested individuals, with tests from five politicians running over accepted safe levels.
“They invade our environment, home-grown vegetables, fish, and our bodies, where they persist forever,” Timmermans said in a statement. “We must stop all emissions of this legalized garbage — we call on Europe to fully ban the use of these chemicals.”
The significance: Five EU countries are advocating for a ban of around 10,000 PFAS – Germany, Denmark, the Netherlands, Norway, and Sweden. The efforts, however, are opposed by the chemical industry, which argues that countries would be hard pressed to find good alternatives in different sectors that use PFAS, such as the fashion industry. The bloc has already banned the use of some forever chemicals, while others are strictly regulated. More on that here.
RUNDOWN
New York Times U.S. will pay to add solar panels to hospitals, schools after disasters
Financial Times The looming trade tensions over China’s subsidies
